There could be many reasons like hardware conflicts, improper drivers, USB port problem etc. I had googled and found the following sites useful, please have a look: daniweb eggheadcafe codingforums virtualdr tweaktown techsupportforum techguy cybertechhelp Please let us know if you found the solution. :)

usually that happens when the pc is being used by a lot of other programs and it has little resources available, since you said it happens at wake up that could well be the issue, everything is trying to get started at the same time and there could be conflicts also. Is it a wired or wireless mouse? does it freeze at other random times? When it freezes could you do a control alt delete and bring up task manager and look at running processes and see how much cpu resources are being used, if you are seeing like 100% then you probably have the answer and you can look at the list to see what items are the ones using the most

It may be IE7 as it had been causing a lot of problems with some people with WinXP. To get rid of IE7, go to Control Panel>Add/Remove>find IE7 and remove. It will revert your laptop back to a newer version of IE6. But, you will have to your laptop off of Windows Automatic Updates, otherwise, the next time it goes for updates it will download and install IE7 again. You will have to do your updates manually. I like that option better as you can see what you are downloading and whether you need it or not.

As ravencajun said it's important to answer questions because it makes troubleshooting easier. Based on what you describe - the same problem with two different operating systems that doesn't happen in safe mode with either O/S I'm inclined to think there's a conflict at the hardware level. If you've been around since 8088 days, you remember IRQs and maybe manually adjusting those? - If you are using a PS/2 (round connector, typically green and purple) make sure you have the plugged into the right place. We all make mistakes. - If you are using a USB connection (small rectangular connector), try a different USB port. If you are using any kind of USB hub, make sure the mouse/keyboard is plugged directly into the machine. If you have a USB add-on card, plug the mouse/keyboard cable(s) into a onboard (motherboard) port. Just for grins you can try the opposite too to rule out any port problems. - Check with the manufacturer of the motherboard or computer for an updated BIOS or chipset drivers - If you have any add-on peripheral cards (network, sound, video capture, etc.) trying removing them temporarily or moving them to another slot. - Borrow or buy another mouse/keyboard, preferably one that is wired. While most mass merchants (Best Buy, etc.) get a little expensive for that kind of stuff, computer stores (Micro Center, etc.) usually have really cheap mice/keyboards sitting on the bottom shelf somewhere. You can also try a Mom 'n Pop computer store, they typically have used stuff cheap.