According to the discussion on the upstream bug, it sounds like this may
now be fixed with latest code, so I'm closing the bug. However, if
you're able to reproduce the problem in current Karmic, feel free to
reopen this bug (and the upstream bug).
** Changed in: xserver-xorg-video-ati (Ubuntu)
Status: Triaged => Fix Released
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[M6-LY] Jaunty Alpha 3 Desktop CD fails to login Gnome
https://bugs.launchpad.net/bugs/318144
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which is the registrant for xserver-xorg-driver-ati.
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