Hi....I don't know if my recent experience is the answer to your particular problem but the circumstances appear rather similiar.
I have an LS430 2005 like yourself and having collected it just last week I was rather perplexed when on my second day of ownership the ignition would not turn on.
I was using the smart key which allowed me entry but whenever I turned the switch it would only turn so far. The steering wheel which had started to move out would return to the off position , the red light on the dash would flash , then nothing.
I came to the conclusion that the Smart Key was at fault.
I had fortunately spent the previous night reading the owners manual from cover to cover and was aware there was a switch hidden under the dash which would switch of this function , and after groping around I found it and managed to switch it off. I was then able to start the car after fitting the key in the slot (the old fashioned way).
Happy to be on the move , but unhappy to have found a fault so early in my ownership.
Later that day I switched the Smart Key system back on and had no problems with it all.
It was only the next day that I recalled an incident during my handover of the car at the garage.While running through some of the many features on the car the salesman invited me to turn the ignition to start it and when it would not turn he advised that the steering lock was engaged and a slight wiggle of the wheel was required !
Doh !!!!!!
I have had no further problems and believe this was the cause of my inital failure.
Gripping the steering wheel while fumbling under the dash must have moved it enough.
Embarrassed as I am to relay this schoolboy error I hope it may be of some use.
Dell