Comment 23 for bug 153188

There is an unofficial package http://people.ubuntu.com/~bryce/Testing/intel/hardy-i386/xserver-xorg-video-intel_2.3.1-1ubuntu1~bwh3_i386.deb (AMD64 http://people.ubuntu.com/~bryce/Testing/intel/hardy-md64/xserver-xorg-video-intel_2.3.1-1ubuntu1~bwh3_amd64.deb) of a newer -intel driver for Hardy.

To install it you have to remove the old i810 driver before.
sudo apt-get remove xserver-xorg-video-i810 xserver-xorg-video-all

If you want to reset everything do the follow commands.
sudo apt-get remove xserver-xorg-video-intel
sudo apt-get install xserver-xorg-video-all

It should work when rac763634 or the Debian sid packages worked for you. If so the issue is already fixed in Intrepid but for Hardy the patch/commit have to be found like described above.