The bug is not a driver issue but a hardware issue.  The OEMs of x1200
series locked down the bios to the integrated graphic card.   To fix
this issue you need to flash a custom bios to your netbook/laptop and
and change the bios settings.  I did this two weeks ago.  my lt3103u
with the x1270 chip is running great.  No  need to turn off KMS  and it
works with the gallium driver with are the standard on the newer
releases of ubuntu.  I posted instructions to ubuntu forum.  Here is the
link:

http://ubuntuforums.org/showthread.php?p=11682072#post11682072

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

Title:
  [rs690m] Graphics corruption with ati x1200

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