i am experiencing the same problem with a 8400GS on a Dell XPS M1330.
what i see here, is that the wrong kernel module is loaded for this
videocard. even after manually installing nvidia-glx-new, this error is
thrown:

"Error: API mismatch: the NVIDIA kernel module has version 71.86.01, but
this NVIDIA driver component has version 169.09."

this error is persistent, doing a:

rmmod nvidia
modprobe nvidia_new

solves it for the current session, it falls back to legacy however after
a reboot.

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Hardy LiveCD fails to identify nVidia 8400M GS on Sony Vaio SZ
https://bugs.launchpad.net/bugs/175436
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