is it going to be possible to install AMD/ATI drivers by clicking system>Administration>Hardware Drivers or do we need to download the source from git or some other bullshit place and compile it
and does the new (ubuntu 10.10) Maverick kernel supports the ATI Radeon 5xxx series
The Hardware Drivers mechanism will get you fglrx, not the open source drivers from git.
AFAIK the kernel driver in Maverick supports KMS on HD5xxx but needs a few extra patches for reliable hardware acceleration. You also need a new X driver anyways (and picking up a newer mesa driver wouldn't hurt).