The Radeon 7000-7500 is NOT, repeat, NOT supported by ATI's binary driver. You are going to be using the DRI project's open-source driver.
Second, you do not install Mesa after XF86. Never ever do that. You will end up reverting to software openGL acceleration.
The Radeon driver is not exactly awe-inspiring in 4.2, although I have not tried the one that comes with XF86 4.3. Obviously, it should not come as a surprise that it's gotten much better over the years, and will continue to do so. I do not know what the Radeon VE's driver is like in particular - I own a Radeon AIW (aka Radeon 7200 AIW).
Now, with that said: I don't know if the Sapphire version is supported or not. I _think_ it is, and if it's not, it probably only requires a simple PCI ID change to fix it. No guarantees, of course.
At this point in time, I would really, really recommend buying nVidia if you want good Linux performance. Their drivers are much, much nicer.