I have same situation after upgrade to karmic.  IMHO problem couldbe
related to KMS which is by default enabled in karmic. KMS defines
maximum virtual resolution to 4096x4096 (You can see it, just run xrandr
in terminal). Unfortunatelly compiz cannot support this resolution for
i945gm - there is hardware limitation to 2048x2048. After connecting
external monitor, kernel or xserver is trying automaticaly setup both
screens side by side what exceeds maximum value for X).

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[i945gm] [karmic] X servers hangs when settings up dual monitor config
https://bugs.launchpad.net/bugs/438000
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