I believe these sort of problems have been fixed in later X.org releases (and thus later Ubuntu releases) on Radeon 7000 series.
** Changed in: xserver-xorg-video-ati (Ubuntu) Status: Needs Info => Fix Released -- live cd chooses wrong video settings for Radeon 7000 https://launchpad.net/bugs/27204 -- ubuntu-bugs mailing list ubuntu-bugs@lists.ubuntu.com https://lists.ubuntu.com/mailman/listinfo/ubuntu-bugs