FWIW, I'm still using Maverick, and the only way I have been able to get
decent video playback and (almost?) no static was to blacklist radeon in
/etc/modprobe.d/blacklist.conf. I imagine the following would also work:

# sudo echo "blacklist radeon" > /etc/modprobe.d/radeon-kludge.conf

This carries with it penalties, but at least I can watch non-fullscreen
Flash video at something better than 2 fps.

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https://bugs.launchpad.net/bugs/556782

Title:
  [rs690m] Graphics corruption with ati x1200

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