I've just now uploaded the 6.11.0 driver to Jaunty, and it claims to
have a lot of improvements for output handling so my guess is that it
may fix this issue.  Would you mind re-testing against current Jaunty
and let me know whether the issue is fixed now?  Thanks ahead of time.

** Changed in: xserver-xorg-video-ati (Ubuntu)
       Status: Confirmed => Incomplete

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[Mobility M7 LW 7500] Virtual screen size too small when using dual head
https://bugs.launchpad.net/bugs/277948
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