Bryce's suggestion works for me.  I put a fresh install of Ubuntu 8.04.1 on my 
computer (homebuilt with a Gigabyte 7ZXE mobo), added an AGPMode of 2 to 
xorg.conf, took the "fail-safe default" values in the BIOS, which set the AGP 
speed to 2x.  No mysterious hangs in 9 hours of uptime last night.  
I tried setting the BIOS to "optimized default" values, which sets the AGP 
speed to 4x, and changing AGPMode in xorg.conf to match.  After about 2 hours 
the computer hung up.  SSH in and Xorg was maxing out the CPU, just like the 
previous hangs and encoded describes in his comments above.
Just changing the BIOS AGP speed to 2x and leaving the rest of the "optimized 
defaults" in place, I've had two sessions today of at least 2 hours each 
without any problems.  
This computer has no problem running with the AGP speed set to 4x in the bios 
when running Fiesty (see Bug #227882), if that makes any difference.

** Attachment added: "lspci.txt"
   http://launchpadlibrarian.net/17527165/lspci.txt

-- 
DRI lockup with AGP on ati (mobility radeon rv350)
https://bugs.launchpad.net/bugs/141551
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