The "modesettings-needs-dri2" patch isn't applied to the xserver version 1.18.4 in buildroot 2016.08-rc1 I managed to hotfix this locally by renaming "package/x11r7/xserver_xorg-server/1.18.3" to "1.18.4". However the commit which introduced this directory (bb6bd531c97734b7be2ec24670771dc10aef1791) mentions that this patch has to be applied to all versions >= 1.17.2. Since version 1.17.4 was added in this release there might be additional steps required to ensure both versions will be patched.
Thanks a lot for your bug report! I've fixed it in commit https://git.buildroot.org/buildroot/commit/?id=3686101a2ae9ec37b4d34a368db03c325f7f92e3.