I was having the same problem on my Sapphire 7950 Vapor X - I could only run it at 12 intensity and 375 kH/s, anything over that gave endless HW errors.  I was on the 13.1 driver.  I rolled my driver back to 12.4 with AMD APP SDK of 2.7 and set the following GPU memory command in my Windows command line:

setx GPU_MAX_ALLOC_PERCENT 100

I believe it was this last step that solved my problem.  Now I can run cgminer 3.1.1 at 19 intensity getting 610kH/s (for LTC).  Hope this helps!