Comment 1 for bug 207474

The same (more or less) happens to me.

Using free radeon driver with an ATI 9600 XT, in a desktop PC. Compiz with Normal effects works ok.

When I click Extra effects, Driver Manager asks whether I want to install the fglrx driver. I always cancel, so I hadn't the nightmare you describe, but still no Extra effects either.

I filled a bug about it that's very similar to yours (title almost stolen from yours, sorry about that), it's #207957.

Out of curiosity, do you have a laptop or a desktop computer? If it's a laptop, your bug could be related to bug #201330.