Similar problems with Logitech drivers here on my WinXP system. To be fair, the support guys there are a helpful bunch, and they did put in a valiant effort, but they were unable to get me fixed up.
I've been a trackball user for a long time now (more room on the desk for half-drunk coffee cups and ashtrays, he he!!). The 'Marble Mouse' I have is beautifully smooth to use and it has the extra buttons and (supposedly) driver support to emulate the middle button and scroller.
Except that I have had nothing but problems getting it to work due to weird clashes with the driver for my (indispensable!) graphics tablet - so I am stuck with having to constantly switch tools, or get used to using a regular mouse again (oh my poor wrists!).