I have quite similar 2-seat setup with a HD4290 (RS880, really ~RV620) and a Juniper HD5750.
The DPMS-problem is evident here. My solution is to ssh in as the problematic seat/user and run:
Sometimes this is required every time, but usually only after the first DPMS off event after logging in. This is only problem with the other seat. DPMS does not always activate if the other seat is in use.
'xset -display :[seat number].0 force dpms on'
Do you have a problem with hot-plugging input devices? My other seat always steals (grabs) the input device and while I can use 'xinput' -program to float it, the other seat fails to see the device.
During bootup, unless I put:
to xorg.conf, input devices are usable from both seats and have to be disable with xinput -float selectively.
Option "GrabDevice" "true"