Date: 03-11-00 06:50
First of all, is this in X or on the console?
If it is in X, make sure you have the proper protocol set for your mouse in /etc/XF86Config and make sure that there is no XF86Config in your home directory for whomever starts X, because that one will get used instead of the default.
The reason I mention the protocol is that when I was experimenting, changing the protocol for something odd tended to make my mouse fly around like you described. In any case, I'm using a wireless logitech and the protocol is IntelliMouse so I could get the scroll wheel to work - bas ackwards...but hey, it works :-)