"Hence it really looks like only the binary drivers (at least nvidia, haven't tested fglrx) are affected."
That being the case, perhaps someone ought to prove it out by installing the Nvidia drivers from the 8.04 era into a fresh install of 9.10 and demonstrating that binary nvidia + compiz + xdamage enabled = no problem.
"Hence it really looks like only the binary drivers (at least nvidia, haven't tested fglrx) are affected."
That being the case, perhaps someone ought to prove it out by installing the Nvidia drivers from the 8.04 era into a fresh install of 9.10 and demonstrating that binary nvidia + compiz + xdamage enabled = no problem.
Or has this been done already?