Comment 4 for bug 271626

Was Hardy a clean install or did you upgrade to it? That xorg.conf isn't a Hardy-style one. The reason the external display didn't work is likely because your xorg.conf is only configured for one display. Hardy should have by default set up one like this (see attachment) to work better for hotplugging. I have a GM965 as well, so maybe try backing up your xorg.conf and testing with the one I attached?

If it's an upgrade, it really would be nice if it gave the option of changing the config. I know the reason it's not changed is to avoid adding regressions, but sometimes changing can be good.