I've been able to reproduce this issue, and have a proposed fix posted
to xorg mailing list
** Changed in: xserver-xorg-video-intel (Ubuntu)
Assignee: (unassigned) => Bryce Harrington (bryceharrington)
Status: Confirmed => In Progress
Target: None => hardy-alpha-5
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[hardy] Enabling "Normal" effects produces badly drawn window shadows.
https://bugs.launchpad.net/bugs/175774
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