First of all, I'll let you know now that I am no computer whiz. Anyways, I downloaded the 295.73 update, and when I go to the NVIDIA control panel then system information, it say's that I have it. I then go to the Skyrim setting things in the Manage 3D Settings place. I'm supposed to change the 'Ambient Occlusion' setting to performance or quality, but i don't even have Ambient Occlusion as an option. It's just not there. I have XP if that helps. What can I do to get it? Thanks!

Go to Manage 3D Settings then Program Settings tab and look Elder Scrolls 5 (under program to customise.)

I did all that but once I got to Skyrim and looked at all the options, there was no option of 'Ambient Occlusion.'

It's not in Skyrim. It's in 3D settings in in Control Panel.

Don't know what you've done then! I'm on 295.73 and the option is there for me.

EDIT...

Wot he said. ^^^^ All you need to do is turn it on in the Nvidia control panel and that's it.

Yeah I know. I'm in the NVIDIA Control Panel, Manage 3D, Skyrim blah blah. I have no clue why Ambient Occlusion doesn't want to show up for me.

You say you downloaded the driver, but did you install it?

I would assume so. When I go to the system information of my control panel, it say's "Driver version: 295.73"

Did you run the installer or not? You only say downloaded, that does not run the installer.

So make this clear:
start nvidia control panel, up help/systeminformation there should be on the first line somewhere "driverinformation" and there should be "295.73". If not, install/reinstall the driver again.

Ok if you have there 295.73 please make a screenshot from the missing spot of "Ambient Occlusion", what do you have there for other options?

Nvidia driver-level Ambient Occlusion requires Vista or Win7 from what I remember, has been this way since they launched the feature with the R180 "Big Bang 2" drivers in late 2008. More reason to ditch that dying OS. I'll see if I can dig up external confirmation.

Confirmed: "In order to use Ambient Occlusion in the Geforce 185.65 Beta you have to install the Vista or Windows 7 version of the graphics card driver."
http://www.pcgameshardware.com/aid,680762/Geforce-18565-Beta-Ambient-Occlusion-in-comparison/Practice/

Well, poop. Here's a screenshot:

Never mind. The pic got all screwy.

Well thanks anyways people!