The new release of X (which comes with Karmic) no longer requires an xorg.conf. Integrated Intel cards should be autoconfigured (I have one on my laptop, which also runs Karmic).
My advice to you is to delete xorg.conf with
sudo rm /etc/X11/xorg.conf
and then reinstall the intel driver (called xserver-xorg-video-intel)
sudo apt-get install xserver-xorg-video-intel
If you get a message saying "program already installed" you can download the .deb file from one of these links
and select the "reinstall package" option.
I hope I helped, good luck!