Geez just when i thought i got it to work after Earlier Problems with latest ATI drivers.
Everything was working fine with latest ATI 8.3 Display Driver. and this release candidate. I took somone beautiful photos in Windlight on maxed out graphic settings. (one of which i attached below as proof
. Frame Rate (FPS) client side was double compared to using ATI 7.11 Drivers and this Release Candidate. My avatar no longer crashed when turning 720 degrees and it was fine.
Then i thought i would chance it and I installed catalyst control center. BIG MISTAKE!!!!!!!!!!!!!
Second Life began to freeze up to a crawl. I mean slow down from say 12 FPS (Client Side) in a high prim area to 0.5 !!!!!!!!!!!!!!!!!
Okay i thought fine. I just uninstall the Catalyst control center. Nope the bug continued to much of my horror. Now using the 8.3 ATI display drivers for my system Second Life is unusable again and now im annoyed.
I have to go back using 7.11 ATI Display Drivers. Which gives me slower frame rate but doesn't crash.
I tried system restore and cannot restore it to before I installed the catalyst control center so I am extremely annoyed and warn anyone not to install cataylst control center if SL works for you.
Attached is a ZIP file of the logs, settings and info i found in the Log folder and a nice screen shot to prove I got windlight working on my machine at least for a day to prove that isn't my imagination.
The system info is included both in the ZIp file and above before i reinstall old display drivers. I tried to give as much info as possible so you have something to go on.
Hope it helps,
Jay Shinobu
Update: 29th March 2008 - 13:34:
I tested the latest release candidate 1.19.1(4) and catatalyst ATI control center version 8.3. I read through a tweaking guide online to and double checked my settings to make sure the catalyst control center wasn't over riding any Second Life settings. Just to make sure and again i had the same problem where I got all the windlight looks with nice clouds an reflecting water but then the frame rate crashed to 0.5 FPS and stayed there. Making SL freeze up and become unstable. I made sure nothing was being overided settings wise by something like the cataylist AI settings.
On the upside using the latest 8.3 Catalyst drivers and the current released viewer 1.19.0.5 makes me have a nice improved frame rate without any issues so far like Windlight releated ones.
I wish i could send you this PC by FEDEX, if you bought me a new one so you could test it and get it working with ATI graphic cards properly so that more people could enjoy the new windlight Features with ATI graphics cards.
Update 2nd April 2008 04.46pm SL Time:
Found exact same bug in todays new 1.9.1(4) Viewer Release.
I just teleported to location above in the system enviroment
Watched frame go from a steady 10 FPS in a laggy/high prim area >> Went made coffee >>> Came back and viewer was at 0.5 FPS!!!! Yet again using latest 8.3 ATI display drivers. And just cause i want to keep remininding you
I get double the frame and shiny clouds using the 8.3 ATI catalyst drivers like 50 % increase client side in FPS with low settings compared to 7.11 where i don't get shiny coulds with atmospheric rendering and just to annoy me even more i can't update the graphics card in pc cause it is integrated into the motherboard and card i have lying around (an Nvidia something) doesn't fit.
/me goes and reinstalls old drivers again 
Update 9th April (As posted in a comment i made below)
ok, i managed to fix the bug that was happening to me. Ok I am defiently not saying this is the case for all problems just the problem i had with SL freezing up after 3 mins and crashing to 0.5 FPS with the latest ATI 8.3 Drivers.
To me to fix it was in graphics >>> goto HardWare options >> and set texture memory(me thinks) to lowest 32MB and that made it run for me. Increasing it all the way back up to 512mb cause the bug to reproduce. (my graphics card is 256mb lol)
Again this is just me finding this out and it fixed the bug i reproduced above and it was so simple i feel like ********* for doing it now and hope this may help some people but i know it wasn't just me finding this out. i see a lot of ATI cards that have reported problems here.
BUT........................................
if a graphics card only has 256mb or memory/whatever and it the slider allows it be increased to double that amount = veiwer freezing/slowing up after a few minutes.
In the pre windlight veiwers you could not select a memory option that was bigger than your grahics card capacity.
So if your card is only 256mb you could only set a max size of up to 256mb not say 512 or 1024.
That would be like trying to fit a Terra Byte onto a 256mb USB thumb drive. It could not cope with so much storage before crashing (thats if it didn't explode first)
Lastly.................................
I have hesations bout setting this bug report to solution provided cause people are still going to have problems unless something isn't hard coded into the viewer to stop the graphics card physcal memory being overloaded in cases like mine.