here you have a howto.
http://wiki.serios.net/wiki/Debian_A...r_installation

here another one, chapter 11 is the one you want.
http://www.rage3d.com/content/articl...00000000000000

you sadly have to read yourself. i have no ATI cards, and therefore have no hands on experience, but their homepage says to use alien (as do both howtos).
http://www.ati.com/products/catalyst/linux.html
Q5: In which formats is the ATI Proprietary Linux driver available?
A5: Linux drivers available on our website are packaged in RPM format. RPM is useful for delivering binary content, and can be converted to other binary formats using freely available tools such as alien. We are also in discussions with various distribution maintainers to provide our drivers in their formats using their repositories and delivery systems in the future.
hope i helped some.
oh and a hdd install would be prefered, even better a Debian sarge Hdd install, installing on the live CD would be a minor nightmare even for a experienced Linux user.