Hey guys, seeing as i finally have managed to get things up and running the way RAGE was intended to play - on my own craptop - i thought i'd post exactly how i did it just so it maybe helps others. So here goes:

First of all you need to download these two drivers in preparation:

11.9 CCC(87mb) link: http://support.amd.com/us/gpudownload/windows/Pages/radeonmob_win7-32.aspx#2

11.10 preview version 2 driver(147mb) link: http://support.amd.com/us/kbarticles/Pages/GPU122AMDCat1110PreDriverV2.aspx

1) Uninstall your current AMD drivers by going to START>CONTROL PANEL>PROGRAMS>PROGRAMS AND FEATURES and the find AMD Catalyst install manager. click change>next>Express uninstall all AMD software.

After this has completed check Program Files(x86) and Program Files for any leftover ATI/AMD folders. If you like you can delete any ATI or AMD folders in the root of C: i.e. same place as Program files and "" (x86).
also check device manager under display adapters to see your video driver is not listed.
RESTART

2) Install the 11.10 pv2 drivers. During install you can choose to do express or custom, i did express but, to not cut back on yourself like i had to, choose custom. You should see all the components for installation and just un-check CCC(Catalyst Control center) - this will come from 11.9 after. At this point your display should be back to normal. you can confirm the adapter is installed in device manager again.

RESTART

3) Install 11.9 CCC and choose custom just to ensure everything is installed and up-to-date.
Open up CCC and under information>software and the catalyst version should say 11.10 - if it does not say this don't worry as even if it did say 11.10 you are still only using 11.9. However, this should be ok.

RESTART

4)Open up CCC and use these settings as a starting point:

Anti-Aliasing - use application settings
Anisotropic Filtering - 8X
Disable Catalsyt A.I - leave unticked
Mipmap Detail level - High Quality
Vertical refresh - On, unless application specifies
OpenGL settings - triple buffering(leave unticked) - i ticked this later though

5) Set the launch options for rage. In your steam library, right-click RAGE then properties>general>set launch options and put:

+cvaradd jobs_numThreads -1 +com_skipIntroVideo 1 +seta com_allowconsole 1 +vt_maxPPF 8

6) i have no config files at all - as we simply shouldn't need this - so launch RAGE and check these options in video settings(I assume everyone has the first and latest patch):
VSYNC - SMART
TEXTURE CACHE - LARGE
ANISOTROPIC FILTER - HIGH
AA - this can be whatever you want. I have it at 4x.

my resolution is at 1366 x 768. so do what you like here until you get the desired result you want.

Now this is what worked without any additional things but you can also add the cache folder which did improve things for more even more - go to step 7).

7)go to START>"YOUR NAME">APP DATA>LOCAL right click and empty space and create a new folder call it "Id Software". open this folder and create another called "Rage". done.
When you start the game next time there will be 2 new files in there.

note: if you can't see the appdata folder, in the folders menu options click TOOLS>FOLDER OPTIONS>VIEW tab>TICK show hidden files, folders and drives radio button.

8)ENJOY rage the way it was meant to be played!

my specs:
Intel core 2 duo T6600 @ 2.2 Ghz
4 Gb Ram i think DDR2
ATI Mobility Radeon HD 4570
win7 Pro 64bit

P.S if you want to benchmark your FPS use a utility called fraps. Even though, on this one, fraps could be wrong because it counts avergae FPS during game play but the game is smooth like butter!

yeah, one of old laptops has exactly the same spec like yours. I didn't install AMD 11.10 preview 2. I am just stick with 11.9 because it is much better in terms of performance. if you use beta driver, it will cause other games. so it's not just Rage for stability. anyway, I am fine with 11.9. no texture issues. megatexture is hit really hard on performance. here is a tip if you don't know yet. mexgatexture requires to stream big chunk of files at the same time. so you need more virtual memory for paging file. it actually really help to run any game great whatsoever. so in my case, recommendation is 6094MB (allocation is 4094MB which is default). I increased 6094MB - 8000MB in windows appearance option. try it out. gaming is simply much better than before. of course, it steals 2GB HDD space. is it matter when you have more than 500GB HDD? little scarifying is necessary.

by the way, in game menu, I tried to turn on texture cache (large), ANISOTROPIC FILTER (high), still keep Vsync off (because I turn on vsync always in AMD CCC panel). two options don't seem to impact performance drop. so as you advice, I will leave them. however I still don't understand why catalyst AI turning on gives me bad frame rate. so far I didn't even care about turning it off because all my games have no problem on it. it's only Rage. I guess that the game uses openGL heavily rather than directX. so driver optimization is not really required. it's all depending on CPU usage rather than GPU.

Glad to help you in anyway archurban. Thanks for taking the time to respond too!
Yeah i know about the paging file but never thought it would improve the gaming that much. I will give it a try though. Did you put 6094 in the initial size and 8000 in the max boxes when changing the paging file size?

With regards to your catalyst A.I giving you bad frame rate; this is the sole reason why i did my upgrade the way i did above. All the core things are up-to-date except the CCC because 11.9 is the last official release instead of the 11.10 preview one. However, like you said, turning it off is not the solution as it messes up every other game. It is a RAGE specific problem unfortunately it seems.

i will be testing out RAGE with your improvement suggestion soon and i hope my smile is even bigger. The only thing that i really want to see now is this game solidly reach 40+ FPS in game at least.

i tryed that at high res wich is the same as yours and it starts too lag here and there and fps all over the place but grats you have the game working