Hi, I had the same problem. I switched to EXA, as using a smaller Virtual 
screen or color dpeth isn't really a solution (I use a dual-head setup with one 
22" display and don't want to miss half the colors). EXA solved the problem of 
unreadable notifications, but messed up display performance (as discussed in 
#363238 [though that discussion targeted on Jaunty]).
I'm quite at a loss now, as unreadable notifications are not a nice thing, but 
having to wait several seconds until Firefox (or any other program) scrolls a 
few rows is unbearable as well. This clearly is a regression from Jaunty as 
there, XAA worked like a charm.

(using Thinkpad T30 with ATI Radeon M7 LW, like the author)

-- 
[M7] (32MB) notification messages are not readable
https://bugs.launchpad.net/bugs/455601
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