Since then, AMD released a X Server 1.5-compatible version of the fglrx 
proprietary driver.
If you can cope with this driver being non free, it can be an alternative.

Besides I think the problem is only for R600+ cards (HD2/3/4xxx). I
tested the radeon driver on older 9700 and X1950 cards and it works very
well.

-- 
Radeon Driver fails to load on 2 Sep daily [ATI HD3870]
https://bugs.launchpad.net/bugs/264462
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