Got the same problem here. Some additional information:
Also occurs with Metacity when Compositing (gconf: apps/metacity) is enabled, 
so I filed a bug against the nvidia drivers that got marked duplicate. Can 
anyone confirm that this is not just a compiz problem? If so, we should figure 
out where exactly the problem lies...

Seeing that people with different drivers (and different WMs) got this
problem, my best guess would be the X.org Compositing Extension. Anyone
with a way to prove that?

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Drop and sub menus don't always show up
https://bugs.launchpad.net/bugs/665546
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