So I've just pushed ati driver 6.7.196-4 to Fedora 8 updates-testing this contains the R500/R600 atombios modesetting code. It'll get into rawhide when it is useable again.... it won't automatically get enabled if you have one of these cards yet, but please test it. I'll try and get the kernel pieces in soon as well for faster r500.
After 6.6.3 during the randr-1.2 development, myself and Alex decided that removing old-style multi-screen dualhead aka zaphod support from the ATI driver would be a good idea. Randr 1.2 is much nicer, and old-style was very intrusive in the driver codepaths and made developing a real pain in the ass.
I've heard a lot of complaints about this and ignored them up until today when I resurrected some work I did for RH a few weeks ago and got zaphod working on top of randr-1.2 internals in the driver. It actually fitted in quite nearly thankfully. This is in a branch that I hope to merge into master quite soon called 'zaphod-lolz'.
To tell the truth I did this because I need to support R500/R600 for RHEL at some point and RHELs dual-head mode is mainly zaphod users, and I never really liked dropping in the first place.