Thanks.  In your Xorg.0.log it indicates that 3D acceleration isn't
working:

(II) fglrx(0): driver needs X.org 1.4.x.y with x.y >= 99.906
(II) fglrx(0): detected X.org 7.4.2.0
(EE) fglrx(0): atiddxDriScreenInit failed, GPS not been initialized. 
(WW) fglrx(0): ***********************************************
(WW) fglrx(0): * DRI initialization failed!                  *
(WW) fglrx(0): * (maybe driver kernel module missing or bad) *
(WW) fglrx(0): * 2D acceleraton available (MMIO)             *
(WW) fglrx(0): * no 3D acceleration available                *
(WW) fglrx(0): ********************************************* *

What version of fglrx-installer do you have installed?  It sounds like
you're using an incorrect version of -fglrx.

** Changed in: fglrx-installer (Ubuntu)
       Status: Incomplete => Confirmed

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Slow Graphics in kubuntu 8.10 with ATI Radeon 2400 HD
https://bugs.launchpad.net/bugs/297868
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