I had lockup problems galore with the nvidia drivers until I added the following to the device section:
This forces X to use nVidia's AGP driver instead of the kernel driver. I believe this is related more to my motherboard (Soyo Dragon Plus V1.0). Since then I haven't had a single lockup (hard or soft).
The lockups were occuring most often when scrolling web pages (Mozilla) or with the XScreensaver demo Euler2d.