My laptop is a "Lenovo T60p" with an ATI video card and it used to work fine on 9.10.
The external monitor works after full cycle of Function+Monitorkeys pressing, but the extended is not working properly.
Anything I should try?
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Seems to be a KMS issue. See: https://bugs.launchpad.net/ubuntu/+source/linux/+bug/562138
In short, add this to your kernel command (test it by holding left-control on boot, edit the command by pressing whichever key it says, control+x to boot):
If you already have a
vga command in there, replace it.
If that works, that confirms you're suffering this bug. It's fixed properly in later kernels (2.6.34 and 2.6.35 should both work) so you're left in a position where you either make do with the kernel run arguments or you upgrade kernel.
The good news is this should be fixed by 10.10... But who knows what bugs it'll introduce!