I am having the exact same problem. I have a nvidia Geforce 7300 LE
card.

If I enable the nvidia driver (instead of nv), when I logoff  I get a
window saying "could not detect monitor or graphic card, server will run
in low graphics mode" (something like that) with
configure/shutdown/continue buttons. I tried to configure my monitor and
card with all the correct settings but it stays in low graphics mode.

I get the same error every time I boot until I removed the xorg.conf
file or change nvidia to nv. But by doing so, the driver returns to nv
and I still can't run 3D (compiz) applications.

Thanks

-- 
Upgrade to Ubuntu 8.10 Alpha 3 stops Nvidia driver working
https://bugs.launchpad.net/bugs/252160
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