Same problem here with latest Karmic updates and Intel Mobile
GM965/GL960 video card (Dell Vostro 1310 notebook).

$ uname -a
Linux dollhouse 2.6.31-11-generic #38-Ubuntu SMP Fri Oct 2 11:55:55 UTC 2009 
i686 GNU/Linux

$ lsb_release -d
Description:    Ubuntu karmic (development branch)

Restarting gdm resolved the problem.

-- 
[Karmic] xorg-server has high cpu utilization - system  slow and unresponsive
https://bugs.launchpad.net/bugs/407309
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