Mouse / KYBD PS2 / USB Not working

After loading system and a few reboots to get it working, I have no mouse and no ability to load drivers.

In safe mode both my PS2 and USB mice work – even simultaneously. But in normal mode I get nothing.

It's not a hardware problem because on shutdown or boot up, the lasers are active.

I've tried the Add/Remove hardware and done a search for new hardware, which doesn't do anything. It just hangs there with a dialog box saying it's searching and showing the percent completion bar, and nothing. I can close it, and use the TAB key to select back or cancel, but that's about it.