Thanks for the report and the additional information. Can you please try with
Option "AccelMethod" "EXA"
in the Device section of your xorg.conf, and see if that helps?
** Changed in: xserver-xorg-video-ati (Ubuntu)
Sourcepackagename: xserver-xorg-driver-ati => xserver-xorg-video-ati
Assignee: (unassigned) => Tormod Volden (tormodvolden)
Status: New => Incomplete
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totem video is garbled with ATi 9200 SE when compiz is enabled
https://bugs.launchpad.net/bugs/274582
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