The issue might be more than that. Ubuntu 14.04 brings a lot more eye candy to the table, but it's my educated guess that accelerated drivers are not enabled in any of the releases you have tried. It's just that the graphical problems are much more apparent when using the most graphically demanding one. But let me explain:
I have an Asus eee PC 1015cx, which uses the Intel Atom Processor D2xxx/N2xxx Integrated Graphics Controller Video. And yes, that's the same driver that the x101ch model uses as well.
After initially receiving it with a Windows7-Starter (ugh), I quickly decided I'd rather work with Ubuntu. But it wasn't that easy. After some digging, I quickly discovered that to enable my video drivers I needed to install the cedarview-graphics-driver (among a few related packages)
The problem with CedarView drivers is that they are close-source, but not only that - they are not actively developed or supported by intel anymore. And that brings a few limitations to the table, namely:
- It doesn't support kernels newer than 3.2. There are attempts to patch this sort of thing, but I haven't tried them.
- It does't work with newer versions of xserver.
In other words - your only option is to install Ubutnu 12.04.01. As of 12.04.02 and later releases of Ubuntu, they all use a newer xserver versions that will not work for you.
I will add one reservation I have - after installing Ubutnu 12.04.01 and the required drivers, updating the kernel didn't cause any trouble, nor did installing a pae kernel as the first link warns agains, so I'm guessing this is mostly an issue with xserver, though your mileage may vary.
One last thing - if you're afraid of installing an old version, keep in mind that 12.04 is a very solid LTS release, and it will remain supported until 2017.