Comment 38 for bug 215604

If you had images with Xawtv and Ekiga, this means that Cheese has a trouble with colorspace, as stated in its error message.
Can you set up a new default colorspace for the webcam with gstreamer-properties?

Blueish image means red and blue inverted in the images. This happened with previous driver versions when the scene is poorly lit. The q2 release solved for that issue. If you have that issue, the image should also be upside down.
Is your image upside down ?

And could you tried to use the "2.6.20-27" release in order to be sure it is OK ?