Exact same problem with a GeForce3 Ti 500. Cannot get past boot splash
with nouveau driver. Works with nvidia-96 installed via jockey-text.

@Jacek, when you enter recovery mode and get the list of options do not
choose to continue with normal boot. I think that is why you get the
blinking cursor (same for me). Instead select root shell or root shell +
networking.

-- 
Ubuntu 10.4 freezes on x-server start with Geforce 3 TI200 
https://bugs.launchpad.net/bugs/544088
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