The newest ATI Catalyst driver (4.8) seems to cause problems with paintball2 (and quake2 in general). Graphics are fine but the framerate is very slow in some areas; 50 fps where it should be 300 -- and smoke grenades cause the framerate drop to unacceptable levels, even below 1 fps when I stand in the middle of the smoke.
I have a Radeon 9600 Pro 128mb. If other people with hardware using the Catalyst drivers (or better yet, the same card as me) can report their experiences with framerate after installing the new drivers, please post in this thread. A fast (though inaccurate) way to check framerate (assuming you have VSync off, of course!) is go to an averagely-dense area of the map and typing the command:
timerefresh
This measures the framerate measured over a quick 360 degree turn. If you have a >1 GHz system and a fast 3D accelerator, this should happen blindingly fast. On my system I used to be getting upwards of 200 fps.