Everyone: I'm happy to report that the ALPS patches we've been testing have been accepted by the mainline input subsystem maintainer and should show up in kernel version 3.3. We also plan to include them in the Ubuntu kernel for the 12.04 release. Thanks for your help in testing!
pauljohn32: In at least one case so far erratic mouse behavior has been shown to be caused by apparent electrical interference from other hardware, and since you say that plugging in USB devices causes the behavior it makes me wonder if you have a similar situation. This probably wouldn't create very dramatic movements when the touchpad was reporting relative motion events, so it may have been there all along but only became noticeable with the new driver as it reports absolute position events. Do I understand correctly that the dumps you gave were taken right after you saw sluggish cursor movement? If so I'll look and see if the data offer any explanation.
BlogCrawler: In your log I see a typo that was fixed prior to the 0.10 version of the driver, so I don't think you're actually using the version from coment #492. You can check what version you have installed by running 'apt-cache showpkg psmouse-alps-dkms' in a terminal. If it shows the 0.10 version installed, you could still be using a previous version if you haven't rebooted or reloaded the driver since installing. To be safe, I suggest that after you verify you have the 0.10 package installed you power off your machine, remove all power (including the battery) for several seconds, then put the battery back in and boot up. Some of the old versions of the driver could leave the touchpad in a bad state when the driver initialization failed where your log shows the failure, and removing all power will ensure that the touchpad is fully reset.