I have noticed an identical problem in 12.04.2(3.5 kernel with xorg
1.13),

Flgrx also fails to install drivers, the conflict being here is the
unsupported xorg 1.13.

I have noticed considerable speed improvements on open source radeon
drivers from 3.5 kernel to 3.8 kernel.

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https://bugs.launchpad.net/bugs/1058040

Title:
  fglrx-installer not working with AMD Radeon/Mobility Radeon HD
  2000-4000 cards in Quantal

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