Do you know if you have "mouse keys" enabled in the Universal Access preference pane? If so, you could try and use the numeric keypad on your keyboard to move the mouse. If you have the new keyboard without keypad, use fn + number keys to move the mouse. 2, 4, 6, 8 is for pointer movement, and 5 is for doing a mouse click.
Might help in identifying if it is an hard- or software-issue.