The latest update running with kernel 3.8.0-17.27 has resolved this
issue for me:
$ dpkg -l|grep nvidia
ii nvidia-304 304.88-0ubuntu1
i386 NVIDIA binary Xorg driver, kernel module and VDPAU
library
ii nvidia-current 304.88-0ubuntu1
i386 Transitional package for nvidia-current
ii nvidia-settings 304.51-0ubuntu2
i386 Tool for configuring the NVIDIA graphics driver
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https://bugs.launchpad.net/bugs/1162013
Title:
no terminals with nvidia graphics driver
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