I also had this problem. My "upgrade" from Gutsy was a bit different, though: I installed Hardy RC over my existing partitions, but preserving /home.
I had to manually switch "allow to control pointer using keyboard" to off.
My keyboard is a Lenovo USB one: Bus 003 Device 003: ID 04b3:301b IBM Corp. SK-8815 Keyboard
I also had this problem. My "upgrade" from Gutsy was a bit different, though: I installed Hardy RC over my existing partitions, but preserving /home.
I had to manually switch "allow to control pointer using keyboard" to off.
My keyboard is a Lenovo USB one:
Bus 003 Device 003: ID 04b3:301b IBM Corp. SK-8815 Keyboard