I've been using r600g for quite a while and it was working well. Since commit 63c3e3a3dc73f8a72e0d08ac4453df57bccdfdb9 XBMC does not display any fonts in the menus any more (XBMC svn, default skin) - I suspect it's a texture problem.
To me it looks like this commit is responsible for this problem:
Author: Keith Whitwell
Date: Tue Nov 9 20:08:45 2010 +0000
r600: fix my pessimism about PIPE_TRANSFER_x flags
*** This bug has been marked as a duplicate of bug 31613 ***