Ubuntu – GUI for iptables

Yes, X forwarding over ssh is a beautiful thing indeed. It allows you to use graphical applications on an app by app basis and have windows handled by your own desktop environment. You do not even need a desktop environment installed on the server.

You do need to set up some authentication things for it to work though. I believe you need xauth for that.

It's SO much faster than VNC as well. VNC was always rather laggy in my experience.

Edit: I have no experience using this method via Windows, but I found this tutorial for you if you're interested.

I highly doubt think you were hacked. Maybe some automated bot TRIED doing something, but I doubt that even happened..

If you disabled Password Auth and did not have a public key set up, there is very very little chance of anything even possibly happening.

In answer to your auth.log queries:

1. That is just PAM complaining about something. Usually just a programming error or a bad dependency. Missing SSH certs maybe? (Nothing to worry about)
2. Pretty much the same thing as #1. I assume someone (sshd) was trying to find certificates and didn't find them. Certs are generally stored in things called "wallets". (Nothing to worry about)
3. User 112 is the LightDM user. It is completely normal for it to be talking to the Xserver. (Nothing to worry about)

Regarding instability and network speed, you just enabled a server. It will definitely be slower. Even if nothing is happening. The increase in program crashing is also probably related. More resources are being used on your computer now. Maybe there are a few config issues.

Also, I've dealt with hackers. If they got in looking for sensitive documents and didn't find them, they'll often troll. They'll delete random files. They'll wipe hard drives. They'll leave your system a broken mess. I think you're safe.