I installed the hotfix over the cat 7.8 drivers. Hotfix seems to uninstall the 7.8s then install itself. I didn't check the driver number, but I don't think it's changed from 7.8
I have a 2900XT (512MB) and applied the hotfix from ATI before trying the demo. No issues at all. Game ran smooth as butter. Looks beautiful too.
I am running Windows Vista Ultimate 64 bit - don't know if that has any bearing.
Also I noticed that the card is running quieter than it was...