I'll try and give you some info here to help you figure out what it is you want to do.
NOTE: I use an nVidia dual-head card, so the terminology I use is based on my setup, but the end results should be comparable. How you arrive at them may be somewhat different using your ATI card.
Dual Head - generally refers to a card with two outputs. ATI may be using this term differently to describe what I know as two separate X sessions.
Big Desktop - I haven't ever heard of this term, so I guess it's an ATI expression. By your description, it sounds like you want a 'panoramic' view, which on my system I achieve by using Xinerama.
my Nvidia driver allows GLX and 3D acceleration and a few other things, while using Xinerama with two displays. ATI systems probably do as well, but I can't give you specifics because I haven't used an ATI card. nVidia also takes care of DRI internally, whereas with ATI you may have to enable it on your own.
Big Desktop (copied from above):
* A single desktop is stretched across both monitors
* Monitors may overlap by a configurable number of pixels
* Both monitors have to operate with the same video mode settings
* Both screens use a single framebuffer and only one window manager
o The smaller display will NOT autoscroll as in Clone Mode
* Big Desktop can be configured for Horizontal or Vertical operation
Xinerama (the way I have mine set up, for comparison):
* A sngle desktop can be stretched across both monitors, including OR excluding the taskbar. OR, each desktop can be unique.
* The stretched method shares a wallpaper; the separate unique desktop method gets two wallpapers.
* Monitors may overlap by a configurable number of pixels (but why would one want this?)
* Both monitors operate at the same color depth, but may have different resolutions.
* Both screens use <framebuffer(s) unknown> and only one window manager.
* Each desktop scrolls, maximizes, minimizes EITHER indepentently, or together, whichever you want.
* Horizontal OR Vertical configuration operation, whichever you want.
* Windows can be dragged from one screen to the other, and mouse goes from one to the other too.
Your file is very similar to mine, except for in yours:
Xinerama being off..
The 'RightOf' option (I use absolute x and y locations)..
And I have a couple nVidia-specific settings.
Not sure all this helps you any, but I do hope it helps you figure out just what it is you would like to do with your desktop.