The mouse not working is an X configuration issue. Sometimes the default configuration has an issue with some mice.
If you haven't solved the issue, you might try:
(I assume that you are in a console window Cntl-Alt-F1 and that you can do an edit in a text window)
1) Look at the /etc/X11/XF86Config file for the Core Pointer InputDevice section. See which Protocol is being used.
2) If it is "auto" or "IMPS/2", edit /etc/X11/XF86Config (as root and after making a backup of the file) replacing "auto" or "IMPS/2" with "PS/2" . I've had issues with auto and IMPS/2 at times.
3) Save the edit. As root, issue the "telinit 3" command to go to multiuser but no X. Then as root issue "telinit 5" command (multiuser with X). See if the mouse works. If it doesn't - post again and let us know.