I finally retired my ancient ancient Radeon X1650 after 3 years or so and upgraded to a brand new XFX AMD Radeon HD 6570, only to have it render my machine useless.

Screen is fine until GRUB loads, then vertical bands of red spots appear. First boot, the display was offset...the last 1/8 or so of the right edge of the screen was on the left.
I commented out the display section of my xorg.conf and now the screen is totally blank after GRUB. Grey when it loads the display manager or black if I switch to a virtual terminal for a blind reboot. I'm running Arch Linux x86-64

do you mean, grub passes ok and after that the horror starts? then there's hope i'd say.