I had the same issue.  When I made changes I was informed it would need
to write to xorg.conf and when I hit ok it would just freeze.  This was
obviously because my user doesn't have access to write to xorg.conf.
When I ran gksudo gnome-display-properties everything worked fine.

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gnome-display-properties does not edit xorg.conf virtual desktop correctly in 
karmic for dual head
https://bugs.launchpad.net/bugs/438715
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