Hi Kiel,
Info regarding the Howler is pretty sparse around here. I could make a lot of assumptions but I think it would be best to contact Andy (U-Trak) and Josh (Howler) about these questions. Both seem quick to reply via email. One question about your drawing. Why do you have a ground coming from the LED? I would imagine that you have two red 5V wires and 2 ground wires from the U-trak but I could be wrong.
I haven't hooked up my Happ trackball to the Howler yet but when I do I will put both 5V lines into the 5V (not the 3.3) and I will use any of the grounds provided on the board.
Let me know how you make out with this.
n3wt0n