Have the same problem on Hardy and HP Compaq nc6000 with ATI MOBILITY RADEON 
9600 graphics controller and fglrx-driver.
I use the ubuntu fglrx-driver from the restricted modules package. (Kernel 
Ubuntu-version: -17)
Also with the standard generic kernel and with a customized kernel with 
radeonfb.
Cannot switch back to X with ctrl+alt+F7 and the same problem when wake up from 
hibernate (TuxOnIce).
I read about a solution by change color depth from 24 to 16 in xorg.conf, but 
didn't dried yet.

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Computer freezes after restarting or resuming an X session when running compiz
https://bugs.launchpad.net/bugs/199776
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