I use a slightly modified version of the method slaymate described for installing drivers.
-Download display driver only from ATI
-Begin installing driver like normal
-The installer should unpack the driver to a standard location C:/ATI/Catalyst 10.6 or something similar for the 10.6 drivers. I don't remember the exact location but the installer tells you so just go to whatever location it lists.
-Start->Control Panel->Device Manager
-Right click on your display adapter and pick "Update driver software"
-Select "Browse my computer for driver software"
-In the box labeled "search for driver software in this location" put the location the ati installer unpacked the drivers to earlier, or use the browse button to select the correct folder.
-Make sure the include subfolders option is checked and hit next
- Windows should install the updated drivers causing you to loose Aero and you display resolution to change temporarily.
-When the process is complete you should be asked to restart your computer.
I don't use Catalyst Control Center as it causes many of the problems that ATI's drivers normally get blamed for. Many times the drivers themselves are rock solid but the same can't be said about Catalyst. That's no big loss though as ATI Tray Tools is an exceptional control center that puts both companies default options to shame.
You can download ATI Tray Tools here.
ATI Tray Tools download from Guru3D.com