Kernel version 2.6.16 has "Local version - append to kernel release" as the first option under general setup. I entered "Testing of Paramater" here and built the kernel. After rebooting I re-emerge nvidia-kernel and nvidia-glx. The nvidia.ko module file was placed in /lib/modules/2.6.16-gentooTesting and could not be used. I removed "Testing of Paramater" fomr Local version, recompiled kernel and nvidia and everything worked fine.
Not supported at the moment, see the other bug. *** This bug has been marked as a duplicate of 128111 ***