First of all, what is it that won't recognize your video card, Windows or Catalyst?
Second, have you tried going to RIGHT CLICK ON MY COMPUTER > PROPERTIES > DEVICE MANAGER and looked at what's there for graphics accelerators? If there's hardware that's already been recognized, then you should RIGHT CLICK and then UNINSTALL and then try to install Catalyst.
If that didn't work out, it could be either a Hardware issue or something else I'm not aware of. That is assumng that X1250 is compatible with Windows 7.