Mouse cursor constantly moves to top left corner (dual mice)

Hi. I have a 27" i7, few months old. I have a magic mouse and the cut down wireless keyboard that came with it - they are attached and working. I also have an additional Logitech wireless keyboard and mouse attached via USB. Up until an hour ago, they were both working perfectly. I'm pretty sure I haven't installed any logitech drivers, they just worked after I plugged them in.

This morning I popped the logitech mouse back in the cradle to charge it. This evening, ever since I've pulled it out of the cradle, the mouse cursor moves to the top left corner of the screen and stays there. I can't control the cursor at all with the Logitech mouse. The buttons seem to work - I can right click on the Apple menu.

I can use the magic mouse to move the cursor around, but as soon as I let it go it makes it's way diagonally up and left, eventually ending up in the corner (it moves at a moderate pace - about 5 seconds from bottom left to top right).

When I put the logitech mouse back in the cradle, the cursor frees up and moves (and stays) normally, using the magic mouse. (I suspect the logitech mouse 'switches off' when in the cradle). I've tried reconnecting the USB cradle, restarting the system, and re-syncing both mice.

Any ideas? Cheers.