Remove /ppa and leave just /radeon. Or better yet, remove both of them, then add /radeon and you should have gallium on by default. Tried that yesterday evening, it was working fine. Tried it with Penumbra Overture, huge performance gain.
I set up Gallium using the /ppa. I couldn't find any examples of an xorg.conf for this, and I found that getting the syntax wrong causes X to refuse to start. This /etc/xorg.conf works for me: