The two xorg.conf files are identical. The difference between the two runs is 
that the second time, DRI is disabled because of:
 [drm] drmSetBusid failed (7, pci:0000:01:00.0), Permission denied

So if I understand correctly, you can boot the Gutsy CD and disable DRI:
 sudo /etc/init.d/gdm stop
 sudo nano /etc/X11/xorg.conf
And add to Device section: Option "DRI" "off"
 sudo rm /tmp/.X0-lock
 sudo /etc/init.d/gdm start

Does this work? If so, repeat it but this time use instead: Option
"BusType" "PCI"

(Alternatively, you can boot the Gutsy CD with the extra "single" boot
parameter. Then in single user mode, edit xorg.conf and press ctrl-D to
continue full boot.)

-- 
upgrade feisty gutsy ati radeon 9200 problem
https://bugs.launchpad.net/bugs/164972
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