Try using a different mouse. If that works, go into your device manager (click Start, right-click My Computer, select properties, click the hardware tab, select Device Manager), expand the Mice section, right-click the mouse and select Uninstall. Reboot your machine.
If the mouse still has the same issues and you can't use it, you can use the keyboard and do the above. To get there, hold down the Windows key and hit the Pause|Break button. This will bring up the System Properties window described above. You can use the arrow keys to get to the Hardware tab. Once there, hit the Tab key until you get to the Device Manager button and hit Enter. In the next window, hit Tab until your computer name is highlighted. Use the arrow keys to get down to the Mice section, then hit the right arrow key to expand the selection. Arrow down to the mouse, and hit the menu key (should be inbetween the right Alt and right Ctrl keys; looks like a menu); this does the same as right-clicking the selected item. Arrow down to the Uninstall selection and hit Enter. Follow the instructions by using the Tab key to select options. Reboot your machine.
Once fully logged into Windows, plug the original mouse in. Windows will then try to install the hardware. You may be required to reboot afterwards. If that doesn't work, you may just want to use a mouse that works (preferably USB).
Edited by Myke (04/09/09 09:55 PM)
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I swear, troubleshooting is a science: the best discoveries are always on accident...