I've discovered another workaround, but it too requires a tradeoff. If
you install the xserver-xgl package, video playback seems to work fine,
and it also enables the water effects compiz plugin. However, I hear xgl
is slower on intel than aixgl, and it will crash if you attempt to run
any other direct rendering 3d program. So I guess we have to choose - 3d
graphics or regular video.

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Gutsy compiz won't enable on intel 965 laptop after 9/18/07 updates
https://bugs.launchpad.net/bugs/140833
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