Getting compiz to work with Xv/OpenGL is still hit or miss on just about any hardware. Your milage may vary. I would advise not using compiz (turning off desktop effects) for general use yet. The drivers still aren't there. Rumor has it that ATI is actually working on this issue, and should have a driver out in early 2009 that should solve the compositing issues.
I believe that there is also an option somewhere to turn off compositing on full-screen windows (which would fix the performace issue for full-screen videos), but perhaps I'm mixing up something else.
Also, open source support for these chips is coming soon (as soon as they can get the code through IP review to release).
I would stick with ATI. Your IGP is far superior hardware to anything Intel makes. (I'm actually not sure how you compiz+Xv working on intel, either, it doesn't work on any stable drivers that I know of yet.) Yes, the drivers are still playing catch-up, but the fact of the matter is that they *are* catching up.