Comment 8 for bug 162136

I installed http://launchpadlibrarian.net/11689116/xserver-xorg-video-ati_6.7.197%2Bgit20080201.bcd59010-0ubuntu0tormod%7Egutsy_i386.deb for testing and the situation is at least "changed"

My internal display is 1024x768. This has never been a problem. The external display is a TFT with 1680x1050 native resolution, working fine with the feisty driver. After installing above package and restarting X, I get a 1024x768 clone display. "System - Preference - Screen resolution" still does not show anything else, but I am told this applet is still a work in progress, some might even say outright broken (did work fine for me with the feisty driver!).

xrandr does seem capable of making this into a dual-head setup, though. Albeit with 1280x1024 for the external display as max (see attached log).