The GMA500 chipset which was licensed by Intel but originated at PowerVR has a pretty bad Linux support.
While there IS a driver, it is mostly closed source, shippes its own DRM module and is basically a big bag of hurt.
While there was some stuff to make it run on Ubuntu, I was never really able to have any success with following those guides.
Turns out, the driver used had a bug with the MSI Wind series of netbooks.
Luckily, had an perfect how-to and a prepatched driver available over here.
I'm now running a fully functional Ubuntu 9.10 with the latest kernel updates and a bunch of applications at about 50% the size of the previous Windows 7 installation. This has the advantage that it actually fits perfectly on the netbooks SDD.