I remember having a similar issue with failure of the
installer to find a certain temporary file/folder. I removed
the software and cleaned out the empty temp folder which
matched the reference. Then I went to the hardware wizard or
device manager and looked for the "default mouse" (usually a
PS2 type) and removed it. Then I did a re detect and at the
find wizard, chose "install from a list or specific
location" and browsed to the file or cd to install the
driver from the inf.