Bioshock on Steam Hangs on Startup

See here, have you tried this?

Right-click it on your Steam games list, go to Properties -> Local Files -> Verify Integrity of Game cache… wait for it to finish and download anything that might be missing and try running it again, don’t forget to allow anything that might be needed to install before the first time the game launches.

I see you installed the latest drivers so I’m guessing that’s not the issue (I found that most of the times my games won’t run if I don’t update my nVidia drivers and they get updated fairly often, you might want to check again for a newer version just to be sure).