Unode, I think you have found something usefull there, if I hadn't read that I might have given up!
I was using Catalyst 8.4 which worked for me up until the last update ((22nd july?) where upon the PClient crashed every time, 75% into loading the world.
I tried: Sound off, Antialias = 0, Fullscreen, VBO off unchecked all pre-loads etc and various combinations to no avail.
I've tried various drivers: 8.7, 8.6, 8.3, 7.12, 7.11, and third party Omega driver 48442, all of which gave me the standard "This program has found a problem and will now close" error.
edit: 7.11 may have worked with the PClient but I could not install them, I'll recheck this at some point.By turning hardware acceleration off I managed to load (albeit unplayable) so this is obviously a 3D/driver related problem.
Anyway the point is
I now have it working using the original
Catalyst 4.6 drivers supplied on cd with the card

so if that's any help to anyone with a similar problem.
edit: and even better, it works with all the fancy options (sound/vbo/AntiA/etc) enabled!Win XP Home
AMD Athlon XP 1.67 GHz
1 GB RAM
Radeon 9800