I was experiencing a similar one after upgrading to 11.10 - garbage on
the screen, and "*ERROR* radeon: couldn't schedule IB" flooding in
dmesg.

Luckily, installing the latest kernel from http://kernel.ubuntu.com
/~kernel-ppa/mainline/ solved the issue for me (I've used 3.1.0-rc9).

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https://bugs.launchpad.net/bugs/586243

Title:
  Xorg freeze: "Failed to schedule IB" Radeon X1200

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