I had the same problem (screen corruption, failure to get into desktop,
Xorg crash, noveau idle channel messages), booting off the latest
Xubuntu 12.10 amd64 liveusb on my ThinkPad W510 with NVidia GT216
(Quadro FX 880M) graphics. Once in a while I'd make it through bootup
into xfce, but mostly not. Sometimes switching to a TTY and typing
"startx" would work, but usually not. Booting with "nomodeset" seemed to
fix the problem, but then once I got into the desktop, the resolution
was too low (1024x768). Perhaps that's not surprising.

Next, I did an update from the repos. Updates included a bunch of Xorg
and nouveau stuff, and at the same time I enabled the latest NVidia
blob. Now I don't have this problem anymore. Not sure if it was the
updates or the switch to the nvidia blob that fixed this liveusb.

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https://bugs.launchpad.net/bugs/1043518

Title:
  live cd is unusable due to video degradation

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