please try  a combination of those lines

Option          "DynamicClocks"         "true"
Option          "AccelMethod"           "EXA"
Option          "DMAForXv"              "off"
Option          "BusType"               "AGP"
Option          "SubPixelOrder"         "NONE"


worked for mine (Dell with ATI M6 running 1400x1050 @ 24bpp).
(don't know which line solved the freeze though :)

-- 
system freeze when using ati radeon 7000 with xorg "ati" driver
https://launchpad.net/bugs/16873

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