I have solved the problem in my case.

It seems that nvidia-glx-new will not work without linux-restricted-
modules-2.6.24-18-server package installed.

If you had a previous version such as linux-restricted-
modules-2.6.24-16-server and run the upgrade, the newer version is not
selected.

FIX:
sudo apt-get install linux-restricted-modules-2.6.24-18-server

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nVidia-glx-new not working with  2.6.24-17-server kernel
https://bugs.launchpad.net/bugs/234996
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