Hmm, the ATI drivers have always had a reputation for being troublesome. It's possible that you could have some vestige of an old driver kicking around...
Before you reinstall Windoze however, try the following to reset your GFX driver.
(1) Uninstall your ATI software/driver. If it asks you to reboot afterwards, don't.
(2) In Windows device manager, find your video card entry (if it exists) open the node and uninstall the device (again don't reboot)
(3) Go through the 'Install new hardware' wizard and select the 'Generic VGA' video card driver (can't remember the exact steps for this - which is why it's a little vague)...
(4) Reboot. You should now have a really nasty, slow 640x480 or 800x600 16 or 256 colour display...
(5) Install the latest ATI drivers and software and reboot if necessary...
Like any system changes though, make sure you've got a backup of all your files just in case it all goes a little Pete Tong...
