I have a Sager notebook with the ATI Mobility Radeon M6 as well. I've never tried dual monitor in X. I have tried it in Windows and when I try to display video with the dual display enabled, whether it be in QuickTime, Windows Media Player, or another application that uses the video overlay I get a black box where the video is supposed to be. I'm not so sure that this is relevant to your problem, but my point is that the card itself doesn't seem to do a good job at dual displays. This happens when I do mirroring or separate displays. As I said I'm not so sure that this is relevant as it could be a driver issue. I just thought that it would be a good idea to let you know.
Also, in X have you noticed that in X the video "hangs" for a half second occasionally? When I run X, no matter what display manager I use, the whole screen will lock up for a half second every few seconds. When running XMMS the sound went right along with the lock ups and paused every few seconds. So far this has been my only complaint about running Linux on my laptop. I'm hoping that somebody else has had a similar problem and will know what to do. Thanks, Jarrett