This is most likely a hardware issue:
http://en.community.dell.com/blogs/direct2dell/archive/2008/09/12/nvidia-gpu-update-limited-warranty-enhancement-details.aspx
There is a dell recall up for this part, they will fix this for free.

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Laptop Graphics Card Damaged (NVidia 8400m)
https://bugs.launchpad.net/bugs/342258
You received this bug notification because you are a member of Ubuntu-X,
which is subscribed to nvidia-graphics-drivers-177 in ubuntu.

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