Probably 

  Load "glx"

is missing in xorg.conf. Attach /etc/X11/xorg.conf and /var/log/Xorg.0.log, please.

Yes, you were right. sax2 did not add Load "glx" to it's startup config. Now it works.

This sounds like a SaX2 bug, which needs to be adressed.

I think this was already fixed in the current sax2 version because it has the following in the changelog:

- removed exception in xc.pl which causes the modules glx,dri NOT
  to be included into the temporary X configuration used by SaX
  to start its own X-Server. There are configurations which requires
  the modules to be loaded otherwise the server will not start at all

But instead sax2 now claims that the lines

ServerLayput -> all -> Screen -> 0 -> top    =
ServerLayout -> all -> Screen -> 0 -> bottom =
ServerLayout -> all -> Screen -> 0 -> left   =
ServerLayout -> all -> Screen -> 0 -> right  =

in /usr/share/doc/packages/fglrx/sax2-profile cannot be parsed because they have the wrong format.

Note that this might be related to the fact that currently it is not possible to update a system completely to the latest release because the drpmsync server still is overloaded and incomplete. If you think this problem might be related to some outdated packages then you might name all relevant packages and I will update them manually and retry.

yes it might be the case Alpha 3 provides an "old" version :-)
If you don't mind please install the packages from the following
location:

  ftp://ftp.berlios.de/pub/sax/head-build/suse-10.1/

Thanks

I got positive feedback that fglrx is working now