I was able to run effects until I did a reinstall, then I had the same problem. If the gnome desktop provides effects, it will not allow compiz to work. Here is the answer for checking your problems. http://forlong.blogage.de/entries/pages/Compiz-Check
or in a termial:
chmod +x compiz-check
Running these commands will tell you the problems. Here is the output:
Gathering information about your system...
Distribution: Linux Mint
Desktop environment: GNOME
Graphics chip: nVidia Corporation NV34 [GeForce FX 5500] (rev a1)
Driver in use: nvidia
Rendering method: Nvidia
Checking if it's possible to run Compiz on your system...
Checking for texture_from_pixmap... [ OK ]
Checking for non power of two support... [ OK ]
Checking for composite extension... [ OK ]
Checking for FBConfig... [ OK ]
Checking for hardware/setup problems... [FAIL]
There has been (at least) one error detected with your setup:
Error: Another compositing manager in use.
Would you like to know more? (Y/n) y
The default window manager of GNOME has its own compositing manager to
provide basic desktop effects.
If this one is in use, Compiz will not be able to run.
Do you want to disable GNOME's compositing manager? (Y/n) y