The Inquirer reports ATI has finished its mainstream RV530 and low-end RV515 cards. Both models sport Shader Model 3.0 and H.264 video acceleration as well.
Much details of these GPUs aren't available yet but it will still take a while until ATI will release these cards as they first need to get the R520 out.
You have to release the high end and later you go out and support it with mainstream and entry level cards. If you think about it you cannot release RV530 and RV515 until you sell all of the X800 and X700 as those cards are Shader Model 2.0 only. If ATI did that, it would kill all sales of those cards.