Please help me! I have the same card (Radeon Xpress 1270), and when I try to run compiz, it says:
compiz (core) - FATAL: GLX_EXT_texture_from_pixmap is missing
compiz (core) - Error: Failed to manage screen: 0
compiz (core) - FATAL: No manageable screen found on display :0.0
I have installed latest proprietary drivers (ati-driver-installer-8-6-x86.x86_64.run) from ATI
When I give glxinfo command, it lists GLX_EXT_texture_from_pixmap in the sections "server glx extensions" (though, before ending it segfaults).
I am running xorg 7.1, if that is of any help.
PS: What do you mean by "Then I enabled advanced visual effects in appearance preferences and it worked this time."? Where did you enable it? I see no such option in ATI Catalyst Control Center.