-I also had the kernel source and header files installed, keep em that way.
-the uninstall part is entirely up to you, if you have 7667, by all means --uninstall it with the 7667 installer, or you could just install 8178 which will perform the uninstall automaticaly. What matters is that you've removed the linux-restricted-modules and nvidia-glx, this is the key.
Either use synaptic(i think it was Kynaptic in KDE) or in the terminal/Konsole type this command: sudo apt-get --purge remove nvidia-glx linux-restricted-modules-`uname -r`. Type the 'uname -r' command to get your exact kernel version, in example my output is "2.6.12-10-386", so i would have to: 'apt-get --purge remove linux-restricted-modules-2.6.12-10-386'
Once you've removed this you can go ahead and upgrade to 8178 and it should work. It does for me anyway.