Comment 3 for bug 572196

This isn't exclusive to your machine i don't think. I have a HP 6735s with ATI Radeon HD3200 (Integrated) with the same problem.

This is a workaround taking the modules used back to the generic

Does terminal login still work? (press Ctrl+Alt+F1 when you think you get to the login screen, gives a login terminal)

If it does, login using your username (not full name) and password, and then use:

sudo nano /etc/X11/xorg.conf

then remove the entry for loading the fglrx module. Then, press Ctrl+X, press y, then enter

then reboot (using sudo shutdown -r now)

when you log in, you'll get an error saying "problem loading modules" or something

tell it to use the generic module, it'll have a progress bar, then take you back to the selections, click cancel and cancel again and it should work (if not, navigate through options)

It's just a workaround, but not a fix. Really annoying. I'm thinking of going back to karmic just to get rid of this