UI1 is the original static UI and is the most basic and least demanding of your graphics hardware
UI2 with Overlay is the newest UI and demands more of your graphics hardware and needs OpenGL support.
UI2 with Alphablending is the most demanding of your graphics hardware and needs good OpenGl support.
Which nVidia card to choose is an interesting question - we currently use the following nVidia cards and onboard chipsets;
On board chip sets;
Many people here have a lot of problems using 8500 or above cards (search the forums there are many threads here on this) and although some also manage to eventually get them working I would personally suggest avoiding them. From a performance perspective they off no advantage over less expensive nVidia cards/chipsets in an LinuxMCE system. So if your looking for an add on card i would strongly recommend an nVidia 6200TC (I use one myself at home)
Hope this helps