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#11
A few things you could check:
Go into BIOS and check the settings for USB Device Configuration. Make sure the newer USB 2.0 options are enabled, and make sure that Legacy USB is set to AUTO or enabled.
Clean install the devices. Go to Device Manager and remove the keyboard and mouse. And/or uninstall any keyboard or mouse software from Remove Programs. Delete any folders containing keyboard or mouse software or driver packages. You know, clean it up! Then reboot and let Windows find and install the generic drivers for both. Use it like that for a while to test before installing any software or driver updates.
When I read:"Mouse Issues: Whenever the cursor passes over an item with which it can interact I get serious lag (cursor freezes for several seconds). Same thing happens when I click and drag the cursor."It occurred to me that this could actually be a video issue. You might try changing the desktop to a non-Aero theme and test. You could also test and see if this behavior occurs in Safe Mode.
Let us know what you find.