I had a similar problem with my x700 (rv410) radeon, and fixed it with:
radeontool light off
radeonreg regset 0x00000284 0x1bd34208
radeonreg regset 0x000002d0 0x003c00a1
radeonreg regset CL:03 0x001c0007
radeonreg regset CL:04 0x0002004a
radeonreg regset CL:05 0x0002004a
radeonreg regset CL:06 0x0002004a
radeontool light on
I had a similar problem with my x700 (rv410) radeon, and fixed it with:
radeontool light off
radeonreg regset 0x00000284 0x1bd34208
radeonreg regset 0x000002d0 0x003c00a1
radeonreg regset CL:03 0x001c0007
radeonreg regset CL:04 0x0002004a
radeonreg regset CL:05 0x0002004a
radeonreg regset CL:06 0x0002004a
radeontool light on
Have you guys tried the radeontool light thingy?