Thanks for reporting this bug.
It sounds like there are at least two issues here. First, that in safe
graphics mode it is not detecting your radeon card; safe graphics mode
ought to *always* work. Second, that it is not detecting your monitor.
The second issue is already known (bug 3731), so I'm going to focus this
bug report on the first issue.
However, it sounds like you've worked around the first issue. For the
second issue, the workaround is to add the HorizSync and VertRefresh
rates for your monitor. Currently it is using generic values which
probably aren't appropriate for your monitor. Usually you can find this
info from your monitor's manual, or by looking on the monitor
manufacturer's website in their support channels. If you do find this
info, can you please report it back here so we can add it to our
database so it works in future versions of ubuntu?
** Changed in: xorg (Ubuntu)
Importance: Undecided => Medium
Status: Confirmed => Needs Info
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ATI Radeon 7200 not detected by x in livecd.
https://bugs.launchpad.net/bugs/108327
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