Public bug reported:

Binary package hint: compiz

Since upgrading to Gutsy, shadows no longer appear under windows when
enabling Desktop Effects. Shadows worked fine in Edgy and Feisty. On the
other hand, CPU spiking has been greatly improved. Deleting all compiz
gconf keys and reinstalling the desktop-effects and compiz packages does
not help. Other desktop effects (transparency, wobbly, etc.) work as
expected.

I am running a Dell C640 laptop with an ATI 7500 Mobility GPU.

** Affects: compiz (Ubuntu)
     Importance: Undecided
         Status: Unconfirmed

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Gutsy - Shadows no long appear with Compiz on an ATI 7500 Mobility
https://bugs.launchpad.net/bugs/121126
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