I have used many different ATI cards, mostly All-in-Wonder and many
different flavor of Linux. Here's what works fo me.
Use xf86config to set it up. All the other programs have (xf86setup,
etc) have not worked well for me. Answer the questions, don't autoprobe
and don't select a clock chip or ramdac.
The XF86Config file created should work. Older cards may require that
"ChipID 0x4755" and "ChipRev 0x01" be hand edited into the XF86Config
file. I thing there is info on this on the xfree.org web page.
The biggest problem with the ATI cards has to do with the video out
signal. When a cable is connected to a TV/VCR the card firmware detects
the presence of this connection and turns on the video out signal so you
can see the video on a TV during bootup. This screws X up resulting in
vertical stripes, multiple images and other artifacts.
Two solutions are possible. Disconnect the cable before you boot the
system or boot to DOS, install the ATI DOS drivers, put "path\install
tvoff" entry in your autoexec.bat file and then start Linux using
loadlin. This is also a good way to get other plug-n-play cards setup
before starting Linux.
Hope this helps.