I'm having the same issues. I'm running Ubuntu 9.04, notify-osd-0.9.11, and 
nvidia twinview and I cannot for the life of me get my notify-osd to appear 
anywhere other than the top-right of my right most monitor (Which happens to be 
the farthest away from me... making notifications almost useless). 
I've tried
>gconftool-2 -s -t string /apps/notify-osd/multihead_mode focus-follow
... no luck. 

Also it should be noted that I do not have any top panels, nor do I plan
on adding any.

Should I try notify-osd-0.9.12? My debug output is almost identical to
@jcornwall s first post.

-- 
regression vs. notification-daemon: positioning when multiple screens are 
available
https://bugs.launchpad.net/bugs/331369
You received this bug notification because you are a member of Notify
OSD Developers, which is subscribed to Notify OSD.

Status in Notify OSD: Fix Released
Status in Notify OSD Series: trunk: Fix Released
Status in “notify-osd” source package in Ubuntu: Fix Released
Status in notify-osd in Ubuntu Jaunty: Fix Released

Bug description:
Binary package hint: notify-osd

I use nvidia TwinView (one X desktop across two monitors). notification-daemon 
was apparently sensitive to this (presumably through Xinerama info?) and would 
popup on my primary screen.

notify-osd seems to be unaware of this, and appears in the top right of the 
overall viewport, which is on my secondary screen, and less visible, so less 
useful as a notifier.

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