Can't Click and Drag in OSX 10.2.8


I have a G3 iBook with 10.2.8. 30GB HD, 256MB RAM.

Everything with the mouse works, except for the dragging capability. Even the tap-click on the touchpad works, but the tap-and-drag doesn't work. I can't drag on the desktop, and I can't drag within programs (like iTunes, or iPhoto).

I have already:

1. Installed the OSX update from the Apple website
2. Reset the PMU
3. Repaired permissions
4. Logged in in OS9, and the dragging works fine in OS9

It must not be a hardware issue, because everything works perfectly in OS9.

Does anyone have any ideas?
Try this;

Delete the icon cache found in /Library/Caches/ whose name is ""

Next, delete these files from the Preference folder located here;


Restart the machine
I deleted those files and restarted, but it didn't change anything. One thing I didn't mention before is that I can drag windows, but can't drag icons. Also, I can't drag anything when I am in a program like iTunes or iPhoto. But I can still move windows around by clicking the top and dragging them....

Also, to answer that other question, I'm using the built in trackpad mouse, not an external one)