hybrid graphics - Can't install ATI proprietary drivers in 12.10

I have a laptop with ATI Radeon 6770M HD Hybrid graphics card. In Ubuntu 12.04, I installed the fglrx driver through "additional drivers" and it worked. (I can even switch GPUs). But in the new Ubuntu 12.10, after installing, Unity won't load.

Only the mouse and the wallpaper. If I initialize the settings sudo aticonfig --initial then after rebooting it gives a warning saying I'm in low graphics mode! How to fix this?

Earlier I used software source to install the drivers. But when using the terminal, I got this warning :

update-alternatives: warning: forcing reinstallation of alternative /usr/lib/fglrx/ld.so.conf because link group x86_64-linux-gnu_gl_conf is broken

Update : Filed a bug report in launchpad : https://bugs.launchpad.net/fglrx/+bug/1068661

I started with a clean 12.10 install (not an upgrade)
My card is a Radeon HD 5450

First thing I done was to install Linux-source and Linux headers

sudo apt-get install linux-source
sudo apt-get install linux-headers-generic

I noticed that many with Nvidia cards were having to do this and am sure I saw mentioned some-where that it also helped ATI users.

Like everyone else if I installed either of the proprietary drivers after reboot I was able to login but lost unity.

One thing I did notice is that installing the driver did not install Catalyst control centre (not sure if it is the same for everyone else)

So I installed Synaptic package manager and installed fglrx-updates from there

Now the Catalyst control centre was installed.

Upon rebooting however instead of being able to login with no Unity the system was hanging at the splash screen.

So I applied nomodeset and this time it booted with Unity present

Here is the result of fglrxinfo

And here is what software sources says

With nomodeset applied I might not be getting the splash screen on boot up but fglrx-updates is working well. I would go as far as to say that it is performing better than it was in 12.04

More info

Grub offers me 2 kernels

3.5.0-18-generic
and
3.5.0-17-generic

The later one '18' is good, the older one '17' still loads without Unity