I am also having this issue.
ATI 4850HD
64 bit ubuntu.
I know the root cause of my troubles: I foolishly tried to install the ATI
driver from the ATI website (version 9.10)
I tried to uninstall it and was stuck with dead keyboard and my monitor in
sleep mode.
I SSHed into my computer and re-installed the broken ATI driver, that got me
something that would at least boot.
tried uninstalling again, this got me to a boot that gave me errors, but
allowed me to boot in safe video mode.
In safe video mode, I re-installed the hardware driver via the "Hardware
Drivers" option.
This left me stuck with the "missing PCS defaults file
/etc/ati/amdpcsdb.default".
I copied the "amdpcsdb.default.dpkg-bak" file to "amdpcsdb.default", and got
something that boots, but now I am stuck with a bug in the lower right corner
of my screen that says:
"AMD
Testing use
only
Unsupported
hardware"
--
fglrx fails at startup because of missing amdpcsdb.default + removal leaves
bad settings in Xorg.conf
https://bugs.launchpad.net/bugs/440233
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