I'm experiencing same problems:
sound + mouse still work whereas the screen freezes
Strg+Alt+Fx and Strg+Alt+Backspace dont work either
and: no such problems when i use nv instead of nvidia.
this is very annoying since it make smy system unusable....
after some time I now believe the problem is related to fonts and their rendering (well.. I guess so )
do nvidia-drivers work well together with XFree or freetype font rendering ?