If I understand you correctly, I can't fit a PCI Express x1 in a standard PCI slot. Is this correct?
Correct
I'm afraid you can only put a bog-standard PCI card in there.
Just to help clarify things, in the above image, the three white slots are normal PCI slots. The two very short yellow ones are PCI-Express 1x and the long yellow one is a PCI-Express 16x slot. You can put a matrox card in the smallest PCI-Express 1x slots, if your board has them.
I'm afraid I'm not sure what would cause the system to crash with the secondary PCI ATI card included. It's a setup which I would expect to work without any problems. Apart from the usual checks on the PSU power rating, driver reinstallations etc, I can only suggest a quick post on the boards at
Guru3D.com or somewhere similiar might help solve things
Perhaps try completely uninstalling your ATI graphics card drivers with only one card installed. Then shut down and install the second card. When you reboot windows, install the latest drivers from the ATI website and appropriate drivers for both cards should be installed. I'm more of an nvidia man so I'm not entirely sure how reliable ATI drivers are with multi-card multi-monitor setups like this.