Commit 96 in my branch should be enough to fix this:
https://code.launchpad.net/~andrikos/ubuntu/quantal/fglrx-installer/fix-switch-to-igpu

We wait for the commit to be reviewed and possibly merged.

Thanks for reporting it.

Nikos

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https://bugs.launchpad.net/bugs/1068404

Title:
  Low graphics mode in Hybrid ATI/Intel GPU systems after fglrx upgrade

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