oh, I noticed at one point you said that you must plug in the usb mouse
for it to work under X etc.  Since you had a lot of useful stuff written
down, I thought I'd contribute a little bit if its useful.  here goes:

I have gpm setup so that it reads both the touchpad and the usb mouse (if
plugged in) and then provides a device for X to read.  If I then point gpm
to the "mice" device then the open succeeds even if a mouse is not
attached.  gpm goes along quite happily, and then when I plug in my usb
mouse, it starts using it.  If i unplug it then i'm back to the touchpad.  
(Or you can use both at same time).

I'm using redhat, but the gpm stuff is quite trivial as redhat just does a
gpm -t $MOUSETYPE.

from /etc/sysconfig/mouse:
MOUSETYPE="ps/2 -m /dev/mouse -M -t ps/2 -m /dev/input/mice -R"

where the /dev/input/mice info is:
crw-rw----   1 root     root      13,  63 Aug 3  2000 /dev/input/mice

and the XF86config file has:
    Protocol    "MouseSystems"
    Device      "/dev/gpmdata"


there is this program called iwheel or something like that which will make
the wheel on the work.  But its such a hack that I haven't been able to
bring myself to do it.

oh, i'm using 2.4.0 test 9.  I think usb has settled down, so the 13, 63
device should work for you I think.  Actually, if memory serves, its been
there since 2.3.26 or something like that.