Using what I got from Robert Hooker ... Here are the full instructions of getting Ubuntu 12.04.2 working with 3.2.0-38 kernel.   I have added instructions for getting mplayer working in HW accelerated mode.   I am not happy with the performance right now, but it works.

Download 12.04.2 from here
 http://releases.ubuntu.com/precise/
ubuntu-12.04.2-desktop-i386.iso    


You should be able to install this to a USB stick
Boot stick
At the main screen, select “Install”  BUT you will need to hit the “tab” key to adjust the load.
Remove  splash – 
Add video=LVDS-1:d
Install image
Reboot

Get into image
From terminal window install ssh server
sudo apt-get install openssh-server  ( you may need this this )
Add the following to /etc/default/grub
GRUB_CMDLINE_LINUX_DEFAULT="vmalloc=256MB video=LVDS-1:d"
sudo update-grub

sudo apt-get install linux-image-3.2.0-38-generic-pae
NOTE:   you can use the above kernel or linux-image-3.2.0-38-generic  both will work.
Run the software update.
sudo apt-get install xserver-xorg-lts-precise

Reboot, you will have a new kernel 3.2.0-38-generic-pae
Select the 3.2.0-38 kernel through grub to boot 

To list all kernels installed, type the following:
dpkg –list | grep linux-image

Let’s get rid of all the kernels we are not using
sudo apt-get purge linux-image-3.5.0- (whatever the rest is)
Now do the rest minus the 3.2.0-38 version you are using.

Notes:   So the above install changes the Ubuntu software stack from quantal (12.04.2) to precise (12.04.1)

Now the following MUST BE DONE from either a terminal window or an ssh session
If you try to install the driver through the graphical interface it will go to a black screen and never come back.  Through the system is still alive.  You can ssh in and remove cedarview-drm.

From a tty window or ssh session

sudo apt-get install cedarview-drm cedarview-graphics-drivers libva-cedarview-vaapi-driver

Sudo update-grub

sudo apt-get install libva-glx1 libva-tpi1 vainfo libva-dev
sudo apt-get install freeglut3 freeglut3-dev binutils-gold
sudo apt-get install libXi-dev libXfont-dev libXext-dev
sudo apt-get install libdrm-dev
sudo apt-get install libpciaccess-dev
sudo apt-get install libXfixes-dev libXv-dev libXpm-dev
sudo apt-get install libX11-dev libXres-dev libXrender-dev libdmx-dev
sudo apt-get install libxkbfile-dev libXinerama-dev libXdamage-dev
sudo apt-get install libXxf86vm-dev mesa-utils
sudo apt-get install libtool autoconf

reboot

Compile mplayer on target

1.	Install yasm and git:
sudo apt-get install yasm git
2.	Install some alsa dependencies:
sudo apt-get install libasound2 libasound2-dev
3.	Clone MPlayer git repository:
git clone git://gitorious.org/vaapi/mplayer.git
If the command executes successfully, then the MPlayer tree is downloaded in the
target under the mplayer directory.
4.	Configure MPlayer:
cd mplayer
git checkout -t origin/hwaccel-vaapi
./configure
At the No FFmpeg checkout prompt, press Enter.
cd ffmpeg
git checkout -b n0.11.2 [you can use the latest version tag]
5.	Go back to the MPlayer directory:
cd ..
6.	Now we are in the MPlayer directory. Configure MPlayer with options as follows:
./configure --prefix=/usr/local --enable-xv --enable-gl --enable-vaapi --disable-vdpau --disable-faad --enable-runtime-cpu-detection
7.	Compile MPlayer:
make
make install

Now you will be able to run video

mplayer -vo vaapi -va vaapi -ao alsa <example_video_clip>.mp4