Here is a snippet of dmesg output just after starting in low graphics mode. I think it identifies the problem. But how to rectify it? A step by step advise shall be appreciated, if the community stalwarts please....
m,decodes=none

wns=io+mem
[ 7.555269] NVRM: loading NVIDIA UNIX x86 Kernel Module 195.36.15 Thu Mar 11 21:41:46 PST 2010
[ 14.804024] ata4.00: exception Emask 0x0 SAct 0x0 SErr 0x0 action 0x6 frozen
[ 14.804029] ata4.00: failed command: IDENTIFY DEVICE
[ 14.804035] ata4.00: cmd ec/00:01:00:00:00/00:00:00:00:00/00 tag 0 pio 512 in
[ 14.804036] res 40/00:01:00:00:00/00:00:00:00:00/00 Emask 0x4 (timeout)
[ 14.804039] ata4.00: status: { DRDY }
[ 19.844008] ata4: link is slow to respond, please be patient (ready=0)
[ 24.828009] ata4: device not ready (errno=-16), forcing hardreset
[ 24.828015] ata4: soft resetting link
[ 25.048645] ata4.00: configured for UDMA/133
[ 25.048656] ata4: EH complete
[ 26.064100] r8169: eth1: link down
[ 26.064232] ADDRCONF(NETDEV_UP): eth1: link is not ready
[ 26.080824] eth0: link up, 100Mbps, full-duplex, lpa 0x45E1
[ 26.214246] NVRM: API mismatch: the client has the version 195.36.24, but
[ 26.214247] NVRM: this kernel module has the version 195.36.15. Please
[ 26.214248] NVRM: make sure that this kernel module and all NVIDIA driver
[ 26.214248] NVRM: components have the same version.
[ 26.376502] NVRM: API mismatch: the client has the version 195.36.24, but
[ 26.376503] NVRM: this kernel module has the version 195.36.15. Please
[ 26.376504] NVRM: make sure that this kernel module and all NVIDIA driver
[ 26.376504] NVRM: components have the same version.
[ 26.534345] NVRM: API mismatch: the client has the version 195.36.24, but
[ 26.534346] NVRM: this kernel module has the version 195.36.15. Please
[ 26.534347] NVRM: make sure that this kernel module and all NVIDIA driver
[ 26.534348] NVRM: components have the same version.
[ 26.692921] NVRM: API mismatch: the client has the version 195.36.24, but
[ 26.692922] NVRM: this kernel module has the version 195.36.15. Please
[ 26.692923] NVRM: make sure that this kernel module and all NVIDIA driver
[ 26.692924] NVRM: components have the same version.
[ 26.871925] NVRM: API mismatch: the client has the version 195.36.24, but
[ 26.871927] NVRM: this kernel module has the version 195.36.15. Please
[ 26.871928] NVRM: make sure that this kernel module and all NVIDIA driver
[ 26.871928] NVRM: components have the same version.
[ 27.030984] NVRM: API mismatch: the client has the version 195.36.24, but
[ 27.030985] NVRM: this kernel module has the version 195.36.15. Please
[ 27.030986] NVRM: make sure that this kernel module and all NVIDIA driver
[ 27.030987] NVRM: components have the same version.
[ 36.512004] eth0: no IPv6 routers present
[ 81.452644] ISO 9660 Extensions: Microsoft Joliet Level 3
[ 81.482301] ISOFS: changing to secondary root