Just tried with the new 1004 release, same results, initial install did the test for alpha-blending which worked. When I got to the home-screen, the flickr images were showing and I could move the cursor with the mouse, but I had the same issue, could not get to any of the menus.
I did the following;
apt-get -y remove --purge fglrx* --force-yes
apt-get -y install --reinstall libgl1-mesa-glx libgl1-mesa-dri --force-yes
apt-get -y install --reinstall xserver-xorg-core --force-yes
After reboot, I only get a grey screen with an arrow , even with "Static Images"
Any ideas would be appreciated