NB: This does not answer your question but rather tells you how to fix your problem while still using the new HWE.

Open a terminal (hold in CTRL and ALT while pressing T)
Add xorg-edgers PPA and update

sudo add-apt-repository ppa:xorg-edgers/ppa

You'll have to supply your password when prompted. You'll get all sorts of info about this repo but to continue just press ENTER

Now in the same terminal:

sudo add-get update

sudo apt-get install nvidia-304

You need to press Y + ENTER for it to be installed.

When it's finifshed you restart your system. To confirm that you are indeed using Nvidia drivers you may open System settings in the menu on top right and choose Additional Drivers from the Hardware section. It takes some time for it to start up but when it's there it will tell you if you are using Nvidia driver. It might be that you could in fact activate your driver from this view after sudo add-get update but I didn't do that so I'm not 100% sure. Before the HWE update I had several choices here but now I only have the one I have installed.

There is a bug report on this issue and it can happen this problem will be solved upstream. To stop using the PPA:

sudo rm /etc/apt/sources.list.d/xorg-edgers-ppa-precise.list

sudo apt-get update

sudo apt-get install --reinstall nvidia-304