for Led lighting - its very focused light.  This is why its so harst to look at them thru the trackball directly.
 I recomend making a 'lightbox'.   Make a small box like unit that holds the led out of view of the trackball (IE: do not place the led under the ball)... 
 The lightbox should be white inside - so that the light bounces arround inside of it.  This will diffuse it - yet should be enough to light up the ball without that harsh beam.