|I have the same problem starting with kernel 3.4.
My video card is Ati Radeon x1250 (shared memory, integrated into mainboard, laptop pc). Putting the files from ucode did not help, only stopped the kernel update message about the missing files.
I am now having kernel 3.3-6 and sticking with it. All others (new) make my system unusable (link to screenshot: http://dl.dropbox.com/u/103396816/Screenshot2.png )
$ uname -r