I also experienced a problem with XVideo on the radeon driver. The image was a lime and lavendar combo, and the image was stretched 2X in the horizontal direction. Is this what you are seeing?
The problem affected only UYVY decoding, other formats were unaffected. I was able to work-around the problem by swapping every pair of bytes and decoding as YUY2.
You don't mention anything about versions. My problem showed up in Fedora 5. The
xorg-x11-drv-ati-6.5.7.3-4 package was OK, then xorg-x11-drv-ati-6.5.8.0-1 was broken. The problem persisted in Fedora 6, which was driver version xorg-x11-drv-ati-6.6.3-1.fc6. Just this week I updated to Fedora 8 and the bug is fixed; driver xorg-x11-drv-ati-6.7.195-3.fc8.


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), but it's possible.