it should get solved by installing a proper ati driver BUT from what i've gathered distros with the xserv 1.5 (like ubuntu 8.10) and 1.4 (can anyone confirm about 1.4?) dont really support ati cards (the drivers ati has released are ultra bugged..) instead i'd suggest using the open soursed ones. try this link for more info http://wiki.cchtml.com/index.php/Ubuntu_Intrepid_Installation_Guide and also https://wiki.ubuntu.com/X/Troubleshooting/Resolution
