I installed the proprietary driver for NVIDIA via the utility 'envy'. 
I think it installed it properly since I see this:

  $ glxinfo | head -4 
  name of display: :0.0 
  display: :0  screen: 0
  direct rendering: Yes
  server glx vendor string: NVIDIA Corporation

envy deinstalled the previous NVIDIA driver, downloaded the source of
the driver, compiled and installed it properly.

However, when I try to enable 'desktop effects' via the top menu, there
is a window that pops up asking to "Enable the driver".  If I chose yes,
it reinstall the NVIDIA driver from Ubuntu packages (which does not
work).  If I say "Cancel", it refuses to enable the desktop effects
saying (please run "desktop effects" again after restarting the
computer, when the new graphics driver is active).  But as far as I
know, it *is* active, it's just not the default driver from Ubuntu
packages (faulty) but the driver built by 'envy'.

-- 
[gutsy] proprietary driver for NVIDIA accelerated graphics not working 
(regression from Feisty)
https://bugs.launchpad.net/bugs/157265
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