Chipset: 915GM
System arch: i686
Distribution: Debian
Machine: Thinkpad X41
related packages:
  libdrm-intel1: 2.4.22-2
  xserver-xorg: 1:7.5+7
  xserver-xorg-core: 2:1.7.7-8
  xserver-xorg-video-intel: 2:2.13.0-2
  linux-image-2.6.36-trunk-686: 2.6.36-1~experimental.1

When using both LVDS and VGA and having enabled compositing in metacity something with is broken, see the attached screenshot.  (I blackened the folder names
as they are named after customers, there is no problem.)
The stacking order in the screen shot is (from top to bottom): Terminal in SE corner, Alarm applet in the center, Terminal in NW corner.

Reproduces 100%.

Still happens when downgrading libdrm to 2.4.21-1, kernel to .32ish and xserver-xorg-video-intel to 2:2.12.0+shadow-2.

Another issue is that running xrandr (without any options) behaves like xrandr --auto.  (This is why I noticed the problem, usually the VGA port is --off.)  This doesn't happen on Debian's .32 kernel.