this is most likely an ATI driver problem. You could try see if it works if you change driver to from ati vesa in /etc/X11/xorg.conf and restart GDM on the liveCD.
-- Repeated suspend mode after 6.10 install https://launchpad.net/bugs/75704 -- ubuntu-bugs mailing list ubuntu-bugs@lists.ubuntu.com https://lists.ubuntu.com/mailman/listinfo/ubuntu-bugs
