Mouse issue: cursor doesn't move downward

So here I was working with photoshop with my graphics tablet on a commission, after 2 hours of using both the mouse (higher DPI than my graphics tablet so clearly I use it to browse the web) and the tablet I got tired of working and played some SSB4. Coming back to photoshop I tried moving the mouse but to find that it can't move downwards. The only way for me to try would be by zig-zagging the mouse downward like a idiot. So I tried some Googling and found out that 1. I'm not the only one (duh) 2. No one seems to have found a definite solution. So I tried uninstalling and re-installing the drivers, nothing. Tried switching mice, same thing but even worse on the other due to lower DPI. Tried using a different surface, same BS. So the last option I can think of was a system restore, backing up my documents into a usb in case something goes wrong the restore is successful.... kind of. The SAME problem persists. So at this point I can be 98% sure that it is not a hardware problem but rather a driver problem. But even then re-installing the drivers did jank s***. By this point I am very salty, to the point where I have a ticket to Salt Lake City. On my way there I realized I should make a post here and see if I can get some help. So if anyone has a solution to this please do explain this to me. And worst case scenario for me would be to re-install windows. But let's hope it doesn't get there.

Does it only happen in Photoshop, or is it in general?

In general, my substitute for a mouse is my graphics tablet at the moment.

Well, one thing to try is to uninstall your tablet software.  It's possible there is some kind of quirk or error that is messing with your mouse reporting or whatnot.

Tried that recently with no help to the problem at all. Man this sucks~

Could be your usb controller, try reinstalling those if you haven't already (as well as making sure all your drivers are up to date).  You could also try a PS/2 mouse (or a PS/2 adapter on your current mouse), that should tell you for sure if it's a usb problem or not.  If nothing works, try throwing a linux distro on a bootable USB drive and boot your computer to that.  See if the mouse is working in linux.  If so, it's a software issue of some sort.  If the problem persists, then it's likely a motherboard issue.

Where would I get distro from? And would booting win 7 to another drive would do just fine? (I have one laying around which I don't use often)
As for the other solutions you mentioned, updating drivers did nothing, PS/2 mouse had the same issue but worse, I couldn't even move it. As for re-installing I have not yet but will do so later. 

Ok so for the re-installing drivers, I click on "uninstall" as shown here
drivers reboot, and windows should re-install those drivers?

Download the latest drivers from your motherboard manufacturer, uninstall the old and install the new.

Yes, booting to another W7 install would work fine.  By linux distro, I mean Puppy, Lubuntu, Ubuntu, Mint etc.  You just go to the website for that linux distro and download the ISO, then use something like Universal USB Installer to mount it on a flash drive, then plug it in and boot to the flash drive (either set it as the first boot device in your bios, or if your motherboard supports it enter your boot selection screen and choose usb).

Also, you did restart your computer after plugging in the PS/2 mouse (or plug it in while the computer was off), right?  It's not plug and play like USB.  Just a heads up.

Yeah I just plug and played it like a normal USB, I'll go ahead and do that first

Finally a good sign! The PS/2 mouse works! :)

In that case, it's most likely a usb issue.  Either a physical problem with your motherboard, or a software problem with the usb controllers.  Booting to a different OS like I suggested above should tell you which it is.  I'd also go ahead and update everything like I said above and see where that gets you as well.

If all else fails, there's nothing wrong with using the PS/2 port for your mouse.

True I can just buy a USB to PS/2 adapter from Amazon which Im sure will work fine, thanks for the help so far. :)

No sweat.  Keep pluggin and I'm sure you'll get it sorted...  but yeah.  If all else fails, a PS/2 adapter will work fine and they are cheap, if you don't already have one laying around.

Okay so I got linux on my USB and the same problem persists on the USB mouse but not the PS/2 mouse which works perfectly fine.

In that case, I'd say it's likely not a driver issue.  It's probably a physical problem on your motherboard (or possibly a bios issue, but I'd say that's unlikely).  I'd still try updating the usb drivers though, just to be safe (it doesn't take long, and it never hurts to be thorough).  Also, just to be sure, you have tried plugging the mouse into different usb ports, right?  To make sure it's not an issue with that specific usb port.

I've tried several ports but came up empty handed. I can try re-installing the USB drivers but in the event that doesn't work either I can try updating my BIOS hoping that works~

Okay so I've updated my BIOS and...... NEVER AGAIN. I got a BOOTMGR error and it made me tear on the inside ;-; but I did fix it which was nice :). So now the only option remains, how do I reinstall my USB drivers?

Update: I got the USB to PS2 adapter but even that didn't work sadly. So last thing I'm suspecting is a bad usb mouse, mobo problem, or a USB drivers thing which I should delete and restart my computer.