Attention!: it seems that the new version of envy has finally gotten the new drivers, so you should be able to install it (with its nifty GUI configuration!). Haven't tested myself, but definitely try that first.
2008-06-15: Took envy for a spin today, and it lists 169.12 as the NVIDIA driver (for the series that needs 173, that is). I think it's just hardy-proposed that it's gotten to, so who knows how long that'll be 'til it gets to us.
I've been typing this out quite a bit recently, so I though I'd just make a well-formatted post to link to.
Before we start, let me tell you that most of this code you can directly copy and paste. The part about killing X that's in bold is the only part that will vary, and you just use the number that's in bold for the first part in the second.
The kernel in Hardy is causing problems with the NVIDIA drivers included in the repositories, so we need to download and install the newest drivers.
From here, download the 173.14 driver (first one listed). If you're using 64-bit *buntu, download the 173.14 from the 3rd section, the one entitled "Linux AMD64/EM64T". Save/move to your home directory.
Write down these instructions, because we're going to be dropping to a command-prompt.
Press ctrl+alt+f1, then enter these commands:
If you're using KDE3, replace gdm in the fourth and sixth lines with kdm; KDE4 users replace with kdm-kde4. Xubuntu users will also use gdm.
sudo apt-get remove --purge nvidia*
sudo apt-get install linux-headers-$(uname -r) libc-dev build-essential
sudo /etc/init.d/gdm stop
sudo sh NVID[tab]
sudo /etc/init.d/gdm start
If stopping the window manager doesn't bring you back to a prompt, press alt+f1 again to do so.
Make sure that when the installer complains about the versions of GCC not matching, you select "no". This will continue the installation.
I would recommend that you select "yes" when the installer asks if you want it to generate an X configuration file. It will create a backup of your current one in /etc/X11 if you need it.
After doing this, I recommend you follow vor's excellently-constructed guide for keeping your NVIDIA drivers working after a kernel update.
If you're getting an error with the installer saying that X is running:
You should see something like this:
ps -ef |grep X (make sure that's a capital X!)
Take a look at the number that I put in bold. Then kill X like so
root 14341 5346 2 20:05 tty7 00:00:16 /usr/bin/X -br -nolisten tcp :0 vt7 -auth /var/run/xauth/A:0-G56yJI
pearson 17629 14881 0 20:16 pts/0 00:00:00 grep X
changing the last number to what it was for you when you ran the previous command.
Alternate trick #1.
Alternate trick #2.
Nullack had to make a few adjustments to his Xorg.conf to get his to work on a fresh 64-bit install.
If this doesn't work, you find an alternate solution, or you had to do something in addition, please let me know so I can update accordingly. We want to reduce pain for others, right?
Also, the well-formatted post I originally started off with has grown rather... well, it's not as good as it could be. However, I am rather bad at things this long, so if anyone would like to reorganize/reformat anything to make it a bit more friendly, then just let me know!