You are right! I was looking for this file. Well it has successfully detected your monitor's resolution, mouse, etc. The logs files should be located in /var/adm directory. Which version of HP-UX are...
Looks like you have to configure the X server settings. Maybe it's not detecting the video card. A log file would have shown us the way. Can you find xorg.conf file in /etc folder? Run the following...
You do not need to reboot the machine. After executing "init 2", the machine automatically executes the run level scripts. One of them is the script responsible for bringing up X server and CDE.
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Okay, what happens when you execute "startx". If the X server is running or if it's due to lock files, you will see the error message. If the server is not running, it will start the services...