Thanks for the replies.
I'm not sure if it's dead, as I can get it to work *sometimes*. It's possible that GND & 5V were swapped if I put the plug on the wrong way up, but I have been able to get it to work.
The problem is now inconsistent, as the vertical axis is now playing up as well. I seem to just get some shaking of the cursor, but no real movemtent. Then, after playing with it for a bit, I can get one of the axes to work. Then, I'll lose that one & get the other one working.

It just seems to me to be an alignment issue, as when I 1st hooked up the spinner, I would just get small amount of jittery movement. I just played around with the position of the optic sensor, and it now is working fine. Now I am seeing the same results with the trackball.
I could be wrong, and I guess that the swapping of the GND & 5V may have damaged it, though, and not killed it completely

I know it's hard to say, but could it be the trackball or the OptiPAC that's at fault? It's quite expensive and lengthy to get this stuff to Australia, so I'd rather know who I should be talking to (Andy from Ultimarc, who I've already been speaking to, or Happ).
If anyone knows where I can pick up a 3" Happ (or other) trackball locally to try it out, I'd be very appreciative!