Installed the "green" driver yesterday, and had not freezes since then.
However, the performance is abyssmal. glxgears reports 1000 fps, 700 w/
Compiz, kwin seems to be able to get the maximum, though. X.org
sometimes uses as much as 70% of the cpu, and the system definitely
feels like it: video lagging, mouse cursor jumping in SDL applications,
etc. I know that the i965 is not the best for playing Crysis, but it
should be able to handle videos and basic compositioning.

Also, as reported before, the KDE 4 screen corruption issue is there.

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[i965] X freezes starting on April 3rd
https://bugs.launchpad.net/bugs/359392
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