I forgot to mention that this workaround is not perfect: when using
Compiz, the windows rendering content using hardware acceleration leave
a trail (old content not redrawn) when you move the window and/or are
not rendered are rendered on only one workspace (sometimes not the one
you would like) when the window is on a side/corner and has pixels in
another workspace. Some apps such as Google Earth behave therefore
strangely when the window is placed on a corner, but at least no HW
freeze as I was getting doing that on a freshly installed Karmic.

-- 
(Needs KMS) Background and full screen apps don't show up when Normal Visual 
Effects on (Radeon 7500) 
https://bugs.launchpad.net/bugs/444139
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which is the registrant for xserver-xorg-driver-ati.

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