Ok, what seems to me to be the problem is the system is having an issue with recognizing USB devices. This might be a problem either with your physical USB ports, or with Windows. Your USB ports might have been damaged, or Windows is having an issue recognizing USB devices once it loads up. Windows is weird in that it loads up all the device drivers and recognizes USB stuff as it starts up and sometimes a USB device that's plugged in before it books will make it go screwy. I've had a similar issue once before.
First of all, what I'd like you to do is unplug the mouse and any other unimportant USB device you have. USB keyboard, USB mouse, USB flash drive, USB external drive....whatever. If it doesn't need to be on there, take it out.
Start up the computer. Once it loads up Windows, try plugging the keyboard and mouse back in. What should happen is Windows, having already loaded the USB drivers and such, will see you plugging in the USB devices again and it will try to detect what they are and get the necessary drivers to make them work.
After you've tried this, let me know what's happening. If it isn't fixed, then there's something even worse that's wrong with Windows or your USB ports.
