[Problem]
An older or onboard ATI gfx card will not work with the X-server on startup, even tho the driver is set to 'radeon' in the Xconfig.
[Solution]
Change the driver from 'radeon' to 'ati'. Yes, its two different drivers, and this worked for me with an ATI R200 on-board graphics adapter on an Shuttle ST20G5 from XPC.