I have a Radeon 9800 PRO AGP card, and I'm running Arch Linux which is running kernel 2.6.32, X.org 7.5 with xorg-server 1.7.3 and xf86-video-ati built from git 09.12.2009, so I just built it.
I didn't report this to the radeon bug tracker yet, as I was wondering if anyone else had seen it and if it might be a bug with something else than the radeon driver it self. I could however not find a report similar to this problem, I used to have more corruption but it went away with 2.6.32, but the KDE-problem still remains.
I don't run with desktop effects enabled, as it's a bit too slow on my computer with a 1920x1080 screen.
As far as I can remember, this corruption started a while ago when I first enabled KMS on this card.