First of all: I am DEEPLY disappointed by Intel. Their Linux support used to be among the best, with PowerVR graphics integration they have made it in no time into the worst category. Not only has their linux driver no working OpenGL support but the 2D "accelerated" performance is worse than the plain fbdev driver. Video support is working but with quite a lot of graphic glitches and bad quality. No 64bit.
I know they are very market oriented and have probably decided its not worth to produce a proper driver for just the "few" of us who decide to use a proper OS. Thing is and they will find out that it is us who decide what others buy. Unfortunately I have to advise my clients to keep away from Intel-Atom products.
Second after almost one week of research and try out I like to share my solutions to others who fatefully trusted Intel:
Compile or use pre-compiled 64 or 32bit kernel Images with GMA500 + GMA3600 DRM enabled (latest Ubuntu kernel come with it by default)
you can use Intel's driver as well but you have to disable their driver and replace it by fbdev either in /usr/share/intel-cdv/xorg.conf.d/61-cdv-pvr.conf or in /etc/X11/xorg.conf (just delete it or move it somewhere else)
install "xcompmgr" if you like to have some desktop effects (works well together with cairo-dock in noopengl mode)
- now 2D works quite fast (lot faster than intels cdv "accelerated" driver"
only thing is the video support (without intels cdv driver we get no xvideo and no va-api support) so either you try to switch between cdv and fbdev whenever you watch a video (I tried that a few days ) or you speedup mplayer.
This is how you get even 1280x512 h264 movies working with better quality than the vaapi driver:
add following lines to /etc/mplayer/mplayer.conf
I found that deleteing the zoom parameter in the file and adding it as cmdline option to mplayer speed thing a bit up
this works with gome-mplayer or any other mplayer based gui program, you can also add all these as parameters to the mplayer command
"-vo x11 -lavdopts=fast:threads=3:skipframe=nonref -sws 0 -framedrop -zoom"
for even more speed run mplayer from the console (or X11) with
"sudo mplayer vo x11 -lavdopts=fast:threads=3:skipframe=nonref -sws 0 -framedrop -fs -vo fbdev -xy 1024 -zoom <filename>"
you may have to change the number of threats - on the atom2700 its 2 cores with 2 threats - 1 = 3
you get gallium software OpenGL but it works and is about 50% slower than the buggy hardware accelerated cdv driver which only support OpenGL-ES
This is of course no replacement for a proper X11 driver but better than anything else I tried.
Hope this helps.
(and to Intel - get some money and pay a proper programmer to write a driver or release the documentation and we will do it if you are to poor or stupid for this)