I have the same problem with an integrated ATI Radeon 1250. Kubuntu 10.04 64bits
The screen flashes always occur when you modify screen settings from 
systemsettings, or launching KrandRTray. Launching any application installed on 
Wine too. The display flashes for a few seconds..
Sometimes also after de flickers the screen becomes corrupted in some sectors, 
and then restored.

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screen flicker ubuntu 10.04 ati x1400
https://bugs.launchpad.net/bugs/576555
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