hey Licaon, thanks for the information. I had came across this magical 8776 and the patch for newer kernels. But since going by the info you provided , 8776 seems to be the only way out. But man, it's sad to know that i cannot use Beryl/Compiz. That was the main motive for me to install Nvidia drivers. Anyways. Will give it a shot and let you know. Moreover there are few more like me who have been facing this trouble.
Here is the link to the thread that I came across:
GeForce2 0x01a0 & 96.43.01 works badly
One question before leaving, why isn't NVIDIA fixing this issue?