I see this thread is kind of old now, but I'm having the same problem. I'm using the normal lock screen. The problem started after a manual update to Froyo on my Moto Droid. There are now two stock clock apps in the app drawer - the first one doesn't display the date and time correctly (some weird characters and symbols). The second clock app seems to work fine.
Except the I'm having this problem with the alarm. The only way to get the alarm to stop is by turning the phone off or force stopping the app through the application manager. Also, the alarm doesn't always malfunction like this, but it seem to do it most of the time.