Hitting the Git repository this week where the Nouveau DRM (Direct Rendering Manager) code for the Linux kernel is developed are two prominent commits alongside several other NV50 and NVC0 "Fermi" commits. This commit enables Nouveau KMS page-flipping for the NV50 class, which covers lots of hardware currently in use out there. This commit that came in shortly thereafter enables page-flipping for the NVC0/Fermi graphics cards.
There's been kernel mode-setting support for the GeForce 400 "Fermi" graphics cards for a couple of kernel releases now, but it's not until the Linux 2.6.38 kernel that there's actually the necessary support in the DRM driver for supporting 3D acceleration (and also needing the latest Mesa code on the user-space side). For now, this support also requires using external, out-of-tree firmware/microcode for the NVC0/Fermi acceleration. With the Linux 2.6.39 kernel, there's now page-flipping. It wasn't until recently that the open-source ATI driver even had KMS page-flipping in its mainline code-base.
Page flipping, of course, dramatically improves performance. Not only does it improve the performance by just changing the pointer between the front and back buffers rather than copying the entire contents back and forth, but this is also designed to lead to tear-free screen updating.
Ideally, by the time the Linux 2.6.39 kernel merge window opens there will be more advancements for the Nouveau project and the other open-source graphics drivers on Linux.