Like I commented on bug 385539, I fixed this temporarily by installing
libgl1-mesa-dri and libgl1-mesa-glx from the Jaunty repositories.

I'm now getting

direct rendering: No (LIBGL_ALWAYS_INDIRECT set)

and

OpenGL vendor string: Tungsten Graphics, Inc.
OpenGL renderer string: Mesa DRI R200 20060602 AGP 8x x86/MMX+/3DNow!+/SSE TCL
OpenGL version string: 1.3 Mesa 7.4

from glxinfo, and glxgears flicker.

Desktop effects are back to Jaunty-speeds, though. I thought I'd have to
go back to 9.04, but this should tide me over.

-- 
(Needs KMS) Background and full screen apps don't show up when Normal Visual 
Effects on (Radeon 7500) 
https://bugs.launchpad.net/bugs/444139
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