I upgraded a Ubuntu VM that I use in VMWare Fusion from 8.04 to 8.10 ("Intrepid Ibex") and was having mouse issues. On a single-click the mouse would act like it was initiating a drag-lock. I could work around it by using the keyboard or rapidly clicking the mouse until it sent a single-click. The solution was to configure the vmmouse driver in xorg.conf.
My xorg.conf mouse configuration originally looked like this:
Section "InputDevice" Identifier "Configured Mouse" Driver "mouse" Option "CorePointer" Option "Device" "/dev/input/mice" Option "Protocol" "ImPS/2" Option "ZAxisMapping" "4 5" Option "Emulate3Buttons" "true" EndSection
I changed the driver to vmmouse:
Section "InputDevice" Identifier "Configured Mouse" Driver "vmmouse" Option "CorePointer" Option "Device" "/dev/input/mice" Option "Protocol" "ImPS/2" Option "ZAxisMapping" "4 5" Option "Emulate3Buttons" "true" EndSection