Sorry for the necro-thread resurrection, but there was never a solution posted.
I just had a CD/TV controller with this problem. There's one 47uF 6V SMT capacitor in the CD/TV controller. When it goes bad (it's the same type as the infamous A1200 ones), it stops the power connection being smooth, so the controller resets back to mouse mode, meaning you have to press the joy/mouse button again.
One nice new 47uF SMT capacitor in there and it's good as new! Hurrah!
