Same here. Fix working. About the same config (64 bit lucid, and 8500
card).

So I guess setting System > Preferences > Appearance to none and adding
"compiz --use-root-window --replace" to System > Preferences > Startup
Applications. Should serve as a workable workaround.

-- 
Compiz / vnc screen refresh with nvidia-restricted driver/VirtualBox/ATI fglrx 
driver using X.org
https://bugs.launchpad.net/bugs/353126
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