Hyper-V "Mouse input not captured"

Steps to resolve this problem:

1. go to virtual machine
2. go to control panel-> programs and features
3. remove "Virtual PC Integration Components"
4. shut down and turn on virtual machine

You have to do all these steps using keyboard. Tab is your best friend here.

In case anyone comes across this:

On Windows Server 2008 32bit you need to install SP2 for Hyper-V connectivity (You won't have mouse integration or networking upon base install, and you can't install the Hyper-V integration CD without SP2) Installing SP2 via mounting a CD ISO is easiest (the ISO is named mu_windows_vista_sp2_x86_x64_ia64_dvd_x15-39754.iso on MSDN) Note: Windows Server 2008 R2 64bit does not have this problem, but I couldn't find R2 32bit on MSDN.

If you don't have MSDN I imagine you could get an offline install for SP2 and "burn" it to a virtual drive to create an ISO.

PS - It was fun trying to do things in the virtual console without keyboard shortcuts like Alt+Tab

Uninstalling "Virtual PC Integration Components" in the virtual machine solved it for me as well. One addition though: when uninstalling it asked for the installation cd/files. To tackle this do the following:

-Locate the iso file you originally used to install the integration features;

File name: IntegrationComponents.iso

Probable location: C:\Program Files (x86)\Windows Virtual PC\Integration Components\

-In Hyper-V Manager select the settings for the virtual machine. Insert IntegrationComponents.iso into the virtual cd/dvd station via Hardware ; IDE controller 1

-(Re)uninstall "Virtual PC Integration Components"