I installed the drivers by:
after enabling the restricted drivers module.
sudo apt-get install xorg-driver-fglrx
Compiz-check is what led me to try the xgl driver in the first place but without xgl installed I get 'FAIL' on the first check and fifth check.
Funnily enough I upgraded to Hardy from Gutsy since posting here (yesterday) and now running compiz-check (without using xgl drivers) yields all 'OK' results:
However, I feel there is still something wrong - I am now able to enable the desktop effects without the xgl driver but if I do I am getting some weird misrendered triangles in the corner of my screen randomly upon opening applications and the occasional hard lock when trying to switch between desktops or super-tab between apps. Are there still some settings that I am not getting right?
Gathering information about your system...
Distribution: Ubuntu 8.04
Desktop environment: GNOME
Graphics chip: ATI Technologies Inc RV350 AR [Radeon 9600]
Driver in use: fglrx
Rendering method: AIGLX
Checking if it's possible to run Compiz on your system...
Checking for texture_from_pixmap... [ OK ]
Checking for non power of two support... [ OK ]
Checking for composite extension... [ OK ]
Checking for FBConfig... [ OK ]
Checking for hardware/setup problems... [ OK ]
This is not a deal-breaker because I love Ubuntu but it'a a bit of an annoyance that I can't get it to work even with a card that should allow me to.