I can confirm these performance issues, I have exactly the card as
original poster:

01:05.0 VGA compatible controller: ATI Technologies Inc Radeon Mobility
U1

Just did upgrade from 9.10. My laptop is Compaq Evo N1015v.
However with 9.10 I had problems with booting as it always hang on black sreen 
and started only when I booted in recovery and then after logging in started 
gdm by typing sudo start gdm. By default compiz effects were enabled which 
caused artifacts. 10.04 does not have any of those problems, but the 
performance is bad.

-- 
[RS100] desktop became slow after upgrading to Lucid
https://bugs.launchpad.net/bugs/544496
You received this bug notification because you are a member of Ubuntu-X,
which is the registrant for xserver-xorg-driver-ati.

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