kernel 2.6.31-1 xorg failure Radeon Xpress 200

Upgraded to 2.6.31-1 from 2.6.30 on Compaq Presario 3.3 gHz Celeron with
01:05.0 VGA compatible controller: ATI Technologies Inc RC410 [Radeon Xpress 200]

Gnome gdm screen is vertical colored bars no usable desktop at all.

Tried nomodeset on the grub kernel line with no effect. KMS is being set since command line is small graphics font.

Ctrl-Alt-F2 command line prompt enabled saving .xsession-errors, syslog, Xorg.0.log

/etc/gdm/Xsession: Beginning session setup...
Setting IM through im-switch for locale=en_US.
Start IM through /etc/X11/xinit/xinput.d/all_ALL linked to /etc/X11/xinit/xinput.d/default.
GNOME_KEYRING_SOCKET=/tmp/keyring-8v7YdN/socket
SSH_AUTH_SOCK=/tmp/keyring-8v7YdN/socket.ssh

(gnome-settings-daemon:3461): GLib-CRITICAL **: g_propagate_error: assertion `src != NULL' failed

(gnome-settings-daemon:3461): GLib-CRITICAL **: g_propagate_error: assertion `src != NULL' failed
Window manager warning: Failed to read saved session file /home/jerry/.config/metacity/sessions/10a7768361bf7c4f9e124667182048323400000033970021.ms: Failed to open file '/home/jerry/.config/metacity/sessions/10a7768361bf7c4f9e124667182048323400000033970021.ms': No such file or directory
** (nm-applet:3496): DEBUG: applet_common_device_state_changed

** (gnome-screensaver:3572): WARNING **: screensaver already running in this session
evolution-alarm-notify-Message: Setting timeout for 80149 1246752000 1246671851
evolution-alarm-notify-Message: Sat Jul 4 20:00:00 2009

evolution-alarm-notify-Message: Fri Jul 3 21:44:11 2009

(gedit:3621): Gtk-CRITICAL **: gtk_tree_sortable_set_sort_column_id: assertion `GTK_IS_TREE_SORTABLE (sortable)' failed

(gedit:3621): Gtk-CRITICAL **: gtk_tree_sortable_set_sort_column_id: assertion `GTK_IS_TREE_SORTABLE (sortable)' failed

(firefox:3915): Gdk-WARNING **: XID collision, trouble ahead

(firefox:3915): Gdk-WARNING **: XID collision, trouble ahead

(firefox:3915): Gdk-WARNING **: XID collision, trouble ahead

Many many pages of the same line. Edit & delete.

(firefox:3915): Gdk-WARNING **: XID collision, trouble ahead

(firefox:3915): Gdk-WARNING **: XID collision, trouble ahead

--- Hash table keys for warning below:
--> x-nautilus-desktop:///
--> file:///home/jerry
--> file:///home/jerry/Desktop
--> file:///home

(nautilus:3481): Eel-WARNING **: "nautilus-metafile.c: metafiles" hash table still has 4 elements at quit time (keys above)

(nautilus:3481): Eel-WARNING **: "nautilus-directory.c: directories" hash table still has 4 elements at quit time
update-notifier: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.
gnome-session: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.
gnome-settings-daemon: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.
polkit-gnome-authentication-agent-1: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.
bluetooth-applet: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.
gnome-screensaver: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.
nm-applet: Fatal IO error 11 (Resource temporarily unavailable) on X server :0.0.