With the ATI graphics, I believe Triple Buffering is on by default for OpenGL. Make sure it is turned off in Catalyst. Every time I have seen this as a problem, it has crashed the client with a specific error report, but it's something to check. There could be other 3D settings causing issues. If you don't have items set to "Application Settings", it might be worth it to try changing to that.
The only other thing I can think of suggesting is check graphics drivers and possibly going back to an older version. I'm not sure it would be helpful, though.