Is Ubuntu recognizing and/or using my NVIDIA graphics card?

• It seems you are running free driver where Steam recommend NVIDIA proprietary driver. You can confirm using: glxinfo or more precisely:

  glxinfo | grep OpenGL
  

• Myself I have bad experience with installing NVIDIA proprietary driver from Ubuntu repository. so I would prefer downloading it from NVIDIA website. Check your OS architecture 32bit or 64bit using System Monitor or by just running one of these commands:

  file /bin/ls    
  uname -a
  

• Drop shell using Ctrl+Alt+F6 , login

  cd to_directory_where_driver
  sudo su
  chmod +x driver_filename
  service lightdm stop
  ./driver_filename
  reboot
  

Read very well the installing messages as the default is not always what you want.

You should keep that driver installation file because it needed in case you want to revert or repair the installation.