I believe this is now fixed in Ubuntu 7.04 development branch
("feisty"), though only in the very newest daily CD images, not the Herd
2 -alpha release. I have almost similar setup, and earlier it didn't
work without manually specifying '"Driver "radeon"' in
/etc/X11/Xorg.conf. Now it works with the default "ati" selection too.
** Changed in: xserver-xorg-video-ati (Ubuntu)
Status: Needs Info => Fix Released
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ubunto live i386 6.06 beta 2 will not startX on DFI infity RS482 (ati chipset)
https://launchpad.net/bugs/45829
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