Indeed, I had the same problems with my Radeon card since I started using the 2.6.11 (and above) kernels.
During several (quite many) recompilings I managed to get: console text but no AGP support or no console text and AGP; one or the other, no way both. I sent a few emails to
linux-kernel@vger.org, I got two replies telling me something like "oh, ok, we'll see what can we do" in one of them and in the other some guy invited me to try out the 2.6.12-rc1 kernel (without luck at that moment) and since then...silence from those guys.
Anyway, during a certain recompile, I accidentaly checked the SMP support option and...surprise...I got a nice VGA text along with AGP support. I went with that certain kernel for a while until I found out what are the necessary kernel settings in order for the card to work properly:
CONFIG_MODULES=y
CONFIG_MODULE_UNLOAD=y
CONFIG_KMOD=y
CONFIG_MTRR=y
CONFIG_AGP=m
CONFIG_AGP_chipset=m (where chipset is the one present on your motherboard, for safety you could compile them all)
CONFIG_DRM=y
CONFIG_DRM_RADEON=m
# CONFIG_FB is not set (uncheck Framebuffer support that is)
CONFIG_TMPFS=y
And yes, now it works fine, without SMP support enabled.
Try these settings and let me know if it works. Indeed, ATIs are some pain in the neck under Linux.