Yeah, she drove him mad and he killed his children, and in some versions of the story, his wife. That act is actually what caused him to do the twelve labours, in order to cleanse himself of the sin.
And to tell you the truth, I still haven't seen all of Clash of the Titans, just bits and pieces. I have watched the old one all the way through though.
i love greek mythology, which is why i'll watch The Immortals also. but you're not missing much with Clash of the Titans. The original was way better. They changed a few things which i didn't like. I think the Medusa in the original was way darker and scarier than the new one. You'd think they'd do a better job of that but it was a disappointment. I didn't like what they did with her. She had a pretty face until she wanted to turn someone to stone, then her face would turn into like a dog/man face or some kind of cougar face. I didn't like it. And the sand/desert creature people made no sense to me. they seemed irrelevant and random. the whole movie felt rushed to me, the pegasus was black, no two-headed dogs, no giant vulture, no robotic owl,.... I can go on and on