I have done some further testing on this (I have setup a test VM).

What I have learnt:

• The issue occurs irrespective of if the Management Tools/Drivers are installed or not.
• The issue occurs with both Xen Orchestra and XO Lite.
• When the issue occurs, device manager shows that the USB controller is stopped. Uninstalling the device and having Windows reinstall it (scan for hardware changes) is sufficient to get the mouse working again.

@dinhngtu well, would you believe it, but a reboot of the host seems to have solved the problem. I haven't done anything else and one of the Windows 10 test VMs that I was playing with quite merrily completed its setup process and loaded into Windows with no drama.