The nVidia driver uses hardware mouse excelleration, during install it checked for existing mouse.
Maybe you can change /etc/X11/xorg.conf manual.
I have two configs, one made by the new setups, one copied from an older setup.
Priny out and look for the differences

see -- Section "Monitor" -- and -- Section "Screen" --
If you copy some parts to your xorg.conf (as root) don't forget to remove settings not supported by your monitor.
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The newest, for me missing some info and with graphical issues 
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# File generated by XFdrake (rev )
Section "Monitor"
Identifier "monitor1"
VendorName "Plug'n Play"
ModelName "W2242"
HorizSync 30-83
VertRefresh 56-75
# Monitor supported modeline (60.0 Hz vsync, 65.3 kHz hsync, ratio 16/10, 87 dpi)
ModeLine "1680x1050" 146.25 1680 1784 1960 2240 1050 1053 1059 1089 +hsync -vsync
# Monitor preferred modeline (59.9 Hz vsync, 64.7 kHz hsync, ratio 16/10, 87 dpi)
ModeLine "1680x1050" 119 1680 1728 1760 1840 1050 1053 1059 1080 -hsync +vsync
# TV fullscreen mode or DVD fullscreen output.
# 768x576 @ 79 Hz, 50 kHz hsync
ModeLine "768x576" 50.00 768 832 846 1000 576 590 595 630
# 768x576 @ 100 Hz, 61.6 kHz hsync
ModeLine "768x576" 63.07 768 800 960 1024 576 578 590 616
EndSection
Section "Device"
Identifier "device1"
VendorName "nVidia Corporation"
BoardName "NVIDIA GeForce 6100 and later"
Driver "nvidia"
Option "DPMS"
Option "TwinViewOrientation" "Clone"
Option "ModeValidation" "NoWidthAlignmentCheck, NoDFPNativeResolutionCheck"
Option "AddARGBGLXVisuals"
Option "ExactModeTimingsDVI"
Option "TwinView"
EndSection
Section "Screen"
Identifier "screen1"
Device "device1"
Monitor "monitor1"
DefaultColorDepth 24
EndSection
# File generated by XFdrake (rev )
# nvidia-xconfig: X configuration file generated by nvidia-xconfig
# nvidia-xconfig: version 1.0 (
root@localhost.localdomain) Tue Apr 27 03:39:11 CDT 2010
# File generated by XFdrake (rev )
# **********************************************************************
# Refer to the xorg.conf man page for details about the format of
# this file.
# **********************************************************************
Section "ServerLayout"
Identifier "layout1"
InputDevice "Keyboard0" "CoreKeyboard"
InputDevice "Mouse0" "CorePointer"
Screen "screen1"
EndSection
Section "Module"
Disable "dri"
Load "dbe" # Double-Buffering Extension
Load "v4l" # Video for Linux
Load "extmod"
Load "glx" # 3D layer
EndSection
Section "ServerFlags"
Option "DontZap" "False" # disable <Ctrl><Alt><BS> (server abort)
# allows the server to start up even if the mouse does not work
#DontZoom # disable <Ctrl><Alt><KP_+>/<KP_-> (resolution switching)
Option "allowmouseopenfail"
EndSection
Section "InputDevice"
# generated from default
Identifier "Keyboard0"
Driver "kbd"
EndSection
Section "InputDevice"
# generated from default
Identifier "Mouse0"
Driver "mouse"
Option "Protocol" "auto"
Option "Device" "/dev/psaux"
Option "Emulate3Buttons" "no"
Option "ZAxisMapping" "4 5"
EndSection
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The older setup, working for me 
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# nvidia-xconfig: X configuration file generated by nvidia-xconfig
# nvidia-xconfig: version 256.35 (
root@localhost.localdomain) Wed Jul 28 12:48:50 CDT 2010
# File generated by XFdrake (rev )
# **********************************************************************
# Refer to the xorg.conf man page for details about the format of
# this file.
# **********************************************************************
Section "ServerLayout"
Identifier "layout1"
Screen "screen1" 0 0
InputDevice "Keyboard0" "CoreKeyboard"
InputDevice "Mouse0" "CorePointer"
EndSection
Section "Module"
Load "dbe" # Double-Buffering Extension
Load "v4l" # Video for Linux
Load "extmod"
Load "glx" # 3D layer
Disable "dri"
EndSection
Section "ServerFlags"
# allows the server to start up even if the mouse does not work
#DontZoom # disable <Ctrl><Alt><KP_+>/<KP_-> (resolution switching)
Option "DontZap" "False" # disable <Ctrl><Alt><BS> (server abort)
Option "allowmouseopenfail"
EndSection
Section "InputDevice"
# generated from default
Identifier "Keyboard0"
Driver "keyboard"
EndSection
Section "InputDevice"
# generated from default
Identifier "Mouse0"
Driver "mouse"
Option "Protocol" "auto"
Option "Device" "/dev/psaux"
Option "Emulate3Buttons" "no"
Option "ZAxisMapping" "4 5"
EndSection
Section "Monitor"
# Monitor supported modeline (60.0 Hz vsync, 65.3 kHz hsync, ratio 16/10, 87 dpi)
Identifier "monitor1"
VendorName "Plug'n Play"
ModelName "W2242"
HorizSync 30.0 - 83.0
VertRefresh 56.0 - 75.0
ModeLine "1680x1050" 146.25 1680 1784 1960 2240 1050 1053 1059 1089 +hsync -vsync
ModeLine "1680x1050" 119 1680 1728 1760 1840 1050 1053 1059 1080 -hsync +vsync
ModeLine "768x576" 50.00 768 832 846 1000 576 590 595 630
ModeLine "768x576" 63.07 768 800 960 1024 576 578 590 616
ModeLine "1920x1200_120" 412.34 1920 2080 2296 2672 1200 1201 1204 1286 -hsync +vsync
ModeLine "1920x1200_100" 337.58 1920 2072 2288 2656 1200 1201 1204 1271 -hsync +vsync
ModeLine "1920x1200_85" 282.74 1920 2072 2280 2640 1200 1201 1204 1260 -hsync +vsync
ModeLine "1920x1200_75" 246.59 1920 2064 2272 2624 1200 1201 1204 1253 -hsync +vsync
ModeLine "1920x1200_60" 193.16 1920 2048 2256 2592 1200 1201 1204 1242 -hsync +vsync
ModeLine "1920x1200_50" 158.08 1920 2032 2240 2560 1200 1201 1204 1235 -hsync +vsync
ModeLine "1680x1050_120" 313.20 1680 1816 2000 2320 1050 1051 1054 1125 -hsync +vsync
ModeLine "1680x1050_100" 256.20 1680 1808 1992 2304 1050 1051 1054 1112 -hsync +vsync
ModeLine "1680x1050_85" 214.51 1680 1800 1984 2288 1050 1051 1054 1103 -hsync +vsync
ModeLine "1680x1050_75" 188.07 1680 1800 1984 2288 1050 1051 1054 1096 -hsync +vsync
ModeLine "1680x1050_60" 147.14 1680 1784 1968 2256 1050 1051 1054 1087 -hsync +vsync
ModeLine "1680x1050_50" 120.21 1680 1776 1952 2224 1050 1051 1054 1081 -hsync +vsync
ModeLine "1600x1000_120" 284.04 1600 1728 1904 2208 1000 1001 1004 1072 -hsync +vsync
ModeLine "1600x1000_100" 232.13 1600 1720 1896 2192 1000 1001 1004 1059 -hsync +vsync
ModeLine "1600x1000_85" 194.21 1600 1712 1888 2176 1000 1001 1004 1050 -hsync +vsync
ModeLine "1600x1000_75" 169.13 1600 1704 1880 2160 1000 1001 1004 1044 -hsync +vsync
ModeLine "1600x1000_60" 133.14 1600 1704 1872 2144 1000 1001 1004 1035 -hsync +vsync
ModeLine "1600x1000_50" 108.66 1600 1688 1856 2112 1000 1001 1004 1029 -hsync +vsync
ModeLine "1440x900_120" 229.75 1440 1552 1712 1984 900 901 904 965 -hsync +vsync
ModeLine "1440x900_100" 187.55 1440 1544 1704 1968 900 901 904 953 -hsync +vsync
ModeLine "1440x900_85" 156.79 1440 1536 1696 1952 900 901 904 945 -hsync +vsync
ModeLine "1440x900_75" 136.49 1440 1536 1688 1936 900 901 904 940 -hsync +vsync
ModeLine "1440x900_60" 106.47 1440 1520 1672 1904 900 901 904 932 -hsync +vsync
ModeLine "1440x900_50" 87.41 1440 1512 1664 1888 900 901 904 926 -hsync +vsync
ModeLine "1280x800_120" 181.21 1280 1376 1520 1760 800 801 804 858 -hsync +vsync
ModeLine "1280x800_100" 147.89 1280 1376 1512 1744 800 801 804 848 -hsync +vsync
ModeLine "1280x800_85" 123.38 1280 1368 1504 1728 800 801 804 840 -hsync +vsync
ModeLine "1280x800_75" 107.21 1280 1360 1496 1712 800 801 804 835 -hsync +vsync
ModeLine "1280x800_60" 83.46 1280 1344 1480 1680 800 801 804 828 -hsync +vsync
ModeLine "1280x800_50" 68.56 1280 1336 1472 1664 800 801 804 824 -hsync +vsync
EndSection
Section "Device"
Identifier "device1"
Driver "nvidia"
VendorName "nVidia Corporation"
BoardName "NVIDIA GeForce 6100 and later"
EndSection
Section "Screen"
Identifier "screen1"
Device "device1"
Monitor "monitor1"
DefaultDepth 24
Option "DPMS"
Option "DynamicTwinView" "true"
Option "AddARGBGLXVisuals"
SubSection "Display"
Depth 8
Modes "1920x1200" "1680x1050" "1600x1000" "1440x900" "1280x800" "1024x768"
EndSubSection
SubSection "Display"
Depth 15
Modes "1920x1200" "1680x1050" "1600x1000" "1440x900" "1280x800" "1024x768"
EndSubSection
SubSection "Display"
Depth 16
Modes "1920x1200" "1680x1050" "1600x1000" "1440x900" "1280x800" "1024x768"
EndSubSection
SubSection "Display"
Depth 24
Modes "1920x1200" "1680x1050" "1600x1000" "1440x900" "1280x800" "1024x768"
EndSubSection
EndSection