(In reply to Christopher from comment #7)
> After I first boot into gnome, with it running on xorg, as soon as I have
> logged in and click on activities on the gnome menu and select terminal,
> then the little circle starts twirling, and after a few seconds the screen
> flashes, and it momentarily goes to the grey login background, then flashes
> to what can only be described as a mini pixal dump, then after a while it
> flashes back to the login screen again and you need to login again.

You're running into bug 105381 , unrelated to this report, fixed in
xf86-video-ati Git master.