How can I prevent my Unity 3D desktop from becoming slow after a while, given that I have an Nvidia Quadro NVS 290 graphics in TwinView mode?

The desktop starts out fast on login, but becomes slow / lagging / hesitant / high latency after a while, symptoms being spikes in CPU usage by /usr/bin/X whenever I cause any graphical activity with the mouse or keyboard (e.g. typing, changing tabs, dragging windows). The desktop remains slow even with all windows (except htop in Terminal) and extraneous processes killed.

Detail: Changing tabs in Terminal takes about a second, and X spikes to 76% CPU. As I type into Firefox, X spikes to 95% CPU. Dragging Termiinal window, X goes to 70% CPU. Basically, every graphical action sends CPU usage of X through the roof.

• Device: Nvidia Quadro NVS 290
• Driver package: binary driver nvidia-current-updates (280.13-0ubuntu5)
• Dual Monitors: Pair of DELL UltraSharp 1908FP in TwinView (X screen 2560x1024)
• OS: Fresh install of Ubuntu 11.10 amd64 Desktop with all updates.
• Hardware: Dell Precision T5400 Workstation
• Pastebin of Xorg.0.log
• Pastebin of xorg.conf
• Pastebin of nvidia-xconfig -t output (easier to read than xorg.conf)

Output of /usr/lib/nux/unity_support_test -p:

To obtain the following htop screenshow I typed "asdf" several times in in this text box, alt-tabbed to Terminal and took a screenshot of the high X CPU usage. This also happens when firefox is not running:

Quadro NVS 290 has "No" thermal sensor according to sensors-detect:

Next adapter: NVIDIA i2c adapter 0 at 2:00.0 (i2c-0)
Do you want to scan it? (YES/no/selectively): 
Client found at address 0x50
Probing for `Analog Devices ADM1033'...                     No
Probing for `Analog Devices ADM1034'...                     No
P    robing for `SPD EEPROM'...                                 No
Probing for `EDID EEPROM'...                                Yes
    (confidence 8, not a hardware monitoring chip)

I tried the nouveau driver by disabling the nvidia-current-updates under Additional Drivers, but Ubuntu and xrandr -q fail to detect the second monitor. This may be issue 737349. Funniest thing is that Nouveau wiki says that XRandR 1.2 dual-monitor is supported so it should work with a second monitor.