BTW, I don't remember this problem with my USB trackballs, so installing a USB mouse might be the easiest solution. $1.99 at Micro-center (not optical, though).
Here's what I've tried so far:
At some point, I removed the "Port" device from the Mouse section of hardware. The system also seemed to like to call it both a HID Device - HID compliant Mouse and a Mouse - PS/2 Standard Mouse type.
I installed the Intellipoint software last night. Same problems as I was having previously with other software. Scroll wheel worked fine initially, but after 2 or 3 minutes, mouse would stop responding. Half the time the keyboard would lock up as well, half the time it would still work. Usually ended up hard shutting down the computer. (Power button).
The mouse also seems to think I've double-clicked when I only single-clicked, not always, but too often.
It was so bad, I had to unplug the wheel mouse and plug in the two-button mouse to uninstall the software.
I then installed the Logitech software. It was more stable, but still not useable. It immediately picked up the new mouse as a two-button wheel mouse, and said it was loading drivers for it. And it never locked up. However, after 2 or 3 minutes, the cursor would randomly disappear and move somewhere else, open stuff I hadn't commanded it to, etc. After that, it would work normally for about 3 or 4 seconds, then start again. No real pattern to what it would run. Generally, I would be trying to access the Start menu, and it would automatically launch something on the quick-launch menu, either Word or Netscape, or Opera, or Cardfile.

I highly suspect that the same stuff was happening with the Intellipoint driver, just that it couldn't keep up and was locking the system up.
So now . . . . As I see it, it's one of the following 4 problems (prolly in increasing order of likelihood):
1) Bad motherboard hardware - Meaning something in the PS/2 port is causing the mouse to lock up. Seems unlikely given that I had identical problems with my ASUS AT style Pentium mobo and with the new Shuttle KT333 Duron mobo.
2) Bad mouse hardware - Maybe, although also unlikely as I think I've had the same problems with other 3-button mice, basically anything other than a 2-button mouse.
3) Virii - This is also unlikely as the problem first occurred almost a year ago, and I run monthly virus scans and updates. It's possible (and acts like) I have a virus no one else discovered yet, but I doubt it.
4) Bad windows driver conflicts - I'm guessing this is the biggest problem. Some registry error or other driver getting in the way. Problem is I don't know how to fix this other than doing a clean install of Windows (Delete Windows directory, re-install re-load all driver, re-install all software.) As I have about 120 programs installed, I don't want to do this, as it would take about a month to get back up and running again.
Anyone know any shortcuts or have any suggestions?