I ran into one of the strangest things a while back. An XP computer that could not use a USB mouse. You could plug the mouse in, the drivers would load, but it would not be usable.
Yesterday, I needed to replace the hard drive in that computer. After imaging the new drive I cleaned up some old junk software. One of the things I cleaned up was Flip software leftover from a Belkin KVM. It was running automatically at Startup.
After the Flip software was taken out of Startup, the mouse worked fine.
Oddly, the USB keyboard worked fine whether the software was installed or not.