This implies you are logging into a graphical session as root. In which case, you will be running upstart as a Session Init to manage that root graphical session. So, to switch to managing the system instead, yes you will need to unset UPSTART_SESSION.
As you say, sudo does not suffer from the issue, neither does logging in as root via a console (as would commonly be done on server systems) since no Session Init is started.
As outlined in the Trusty Release notes [1], you can also specify --system to the initctl command as an alternative to unsetting UPSTART_SESSION.
This implies you are logging into a graphical session as root. In which case, you will be running upstart as a Session Init to manage that root graphical session. So, to switch to managing the system instead, yes you will need to unset UPSTART_SESSION.
As you say, sudo does not suffer from the issue, neither does logging in as root via a console (as would commonly be done on server systems) since no Session Init is started.
As outlined in the Trusty Release notes [1], you can also specify --system to the initctl command as an alternative to unsetting UPSTART_SESSION.
[1] - https:/ /wiki.ubuntu. com/TrustyTahr/ ReleaseNotes/ TechnicalOvervi ewUpstart.