I have the same problem using the nvidia driver (actually nvidia-96)
with a GeForce3 card and a recent installation of Ubuntu 12.04.  While
booting up, the grub menu works fine, but after that, the screen goes
blank with just a cursor.  The lightdm login screen comes up with less
than full resolution, but that's no big deal.  The X session itself
works fine.  However, the tty 1-6 screens are blank with just a cursor,
just like the boot console screen.  I have a second 12.04 installation
on another partition of the same hardware, which was upgraded from
previous versions of Ubuntu.  Booting from this partition, I have the
same problem, except that the console and tty 1-6 show a low resolution
screen with just black and white stripes and blocks, just like the
original poster described, instead of blank with just a cursor.  I have
no idea when the problem started, because I had been using the nouveau
driver for a year or two before now.  However, that driver started to
have its own problems recently too.

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https://bugs.launchpad.net/bugs/953919

Title:
  corrupt boot splash and terminal console with nvidia driver

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