I am having this same problem on a 9200SE card. There's a whole forum topic on 
this:
http://ubuntuforums.org/showthread.php?t=1308027

Simply disabling desktop effects has "solved" my problems (I get full
desktop functionality but no effects). Also, editing xorg.conf to force
XAA instead of EXA mode has worked to allow desktop effects, although
performance is then very slow.

I can provide information for my system if need be. I was attempting to
file a new bug when launchpad directed me to this report.

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Desktop background becomes black when desktop effects are enabled on GNOME and 
KDE
https://bugs.launchpad.net/bugs/462436
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