Comment 28 for bug 106217

I hit this one as well on Gutsy 7.10rc today, machine wouldnt start gdm using an nvidia-glx after first having nvidia-glx-new installed. Had to manually insmodding the correct nvidia.ko and then start gdm, bit of a pain as nvidia-glx-new is no good for nouveau Reverse Engineering (it causes crashes on PCIE machines) so downgrading to nvidia-glx is required.

Deleting the file /lib/linux-restricted-modules/.nvidia_legacy_installed work for me

p.s Nice work on the graphical xorg fall back configuration, much better than the ugly old white text on blue background with red buttons curses messages.