I had the same problems on 7.04 7.10 and 8.04. I fixed mine by going into
screens and graphics and reseting there. For some reason that is not showing up
in the system menu on my 8.04. but I found it under applications other. Have you
tired that? there is some post in launch pad wher they show you how to
reconfigure it in xorg by setting the default to what ever you want. 7.10 took
me forever to get working. Was easy in 8.04.