Only reasonably recently. Clarkdale added it last generation but those were quite rubbish, capable of only really driving a display and nothing else.
Sandy Bridge is another kettle of fish. There's two types on there - HD2000 and HD3000. The K series CPUs and the mobiles get HD3000, the rest get HD2000.
In terms of performance, they're much better. The HD3000 can rival a bottom end 3D card in gaming! It's really quite impressive, and the HD2000 isn't exactly miles behind. It's basically cut the end off the HTPC card market for nVidia and AMD.
There's also the AMD Brazos - benchmarks went up for that today. Although it's designed to rival Atom more than Sandy Bridge, if you're using the integrated graphics it runs the HD2000 graphics very very close at a fraction of the power usage.
No integrated graphics is going to rival the HD5770 though.