Same Problem with my Laptop too.
System is Dell Latitude D600 with ATI Mobility Radeon 9000 (RV250) run by 
radeon. Though Xorg consumes over 90% CPU-time when in use the system doesn't 
freeze. Windows are reacting very, very slow (with artefacts, blank screens and 
so on) but keyboard and mouse are generally usable.

By now I didn't install xserver-xorg-video-ati-dbg and I'm not
experienced with bugtracking. But if there's anything I can contribute,
let me know.

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runaway Xorg in drmDMA() (radeon)
https://bugs.launchpad.net/bugs/347078
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