I'm having the same problem.
I edit my xorg.conf with the parameters that awol post here.
When i restart X, with Ctrl+Alt+Backspace, all wok fine. But when i restart the 
system, ubuntu initialize in low graphics mode.
Threre is a definitive solution for this Bug?

** Attachment added: "My xorg.conf"
   http://launchpadlibrarian.net/11734685/xorg.conf

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NV20 [GeForce3] nvidia not supported by nvidia-glx in gutsy
https://bugs.launchpad.net/bugs/155231
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