I'm having the same problem.

Using the free radeon driver, applying the rotation restarts X, always
reverting to the no rotation setup.

Using the proprietary fglrx driver, cannot start X having the rotation
setup (actually, it freezes the computer when trying to start X -- no
CTRL+ALT+Fn, no response from the power button, etc).

My card is a Radeon HD 5450 that came with a Dell Optiplex 990.

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https://bugs.launchpad.net/bugs/683905

Title:
  Xorg locks up after crash with Radeon HD5670 and dual-monitor setup

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