I think @orange is onto something here. Check the voltages if you have a schematic. Also, it may sound dumb, but try moving the mouse pointer with the keyboard shortcuts. Just to make sure it *does* move. Also I'd remove the drive sled and inspect carefully the area around the back of the mouse port. Check for any battery leakage that might've snuck its way over there, loose solder joints, etc. You may need to remove the motherboard and check from the bottom, as well. Try booting from a game disk and make sure your joystick/port 2 works okay.
A few other similar tips here:
https://groups.google.com/forum/#!topic/alt.amiga/GLNKqm0ey5MGood luck!
As a side thought, what revision motherboard are you using? If it turns out to be a motherboard problem and you're using a 4.x, you might be better served to just replace it with a 6.x. Much fewer bugs in those revisions.
