I have a Microsoft wireless optical mouse and Multimedia keyboard and Vista
Home Premium Edition. When update KB937954 was downloaded and installed I
lost USB recognition of the wireless device. I've tried removing and
reinstalling the drivers and taking the plunge and installing SP1, but with
no success. Vista simply refuses to recognise the USB device - although the
driver software recognises strong signals from both mouse and keyboard.

I've had to dig out old wired versions of both - the wired USB mouse works
fine.

This has been mentioned in a number of Forums across the web, but is there a
fix yet? Microsoft mentioned in a statement working with hardware
manufacturers, but this is your hardware. Is there a fix and if not when can
it be expected?