Ok, I think the problem was with xauthority locking up for some reason. Closing the bug.
** Changed in: xserver-xorg-video-ati (Ubuntu) Status: Needs Info => Rejected -- X windows fails to create new windows after hibernating (somtimes) https://launchpad.net/bugs/59055 -- ubuntu-bugs mailing list ubuntu-bugs@lists.ubuntu.com https://lists.ubuntu.com/mailman/listinfo/ubuntu-bugs