Parallel 4 Upgrade Mouse and Coherence Problems

I've just upgraded from Parallels 3 to 4; most everything is working but the virtual machine won't automatically capture and release the mouse, and it won't go into coherence mode.

Has anyone else had this issue or even better find a way to fix it?

17" iMac 2GHz Core 2 Duo, 3GB RAM, 250GB internal HD, external Firewire Drives
Second monitor, Apple Mouse
Host=OSX 10.5.8, Parallels build 4.0.3844, Guest=Windows XP SP2

 

Have you tried installing/reinstalling Parallels Tools? This is the most common problem with mouse capture concerns. I don't generally use the coherence mode so I cannot provide any helpful hints for you with that problem.

 

Thanks, I tried that and it worked.

I was also pleasantly surprised to see that a Parallels staff member changed this equry into a self service ticket for me, and the provided the same helpful advice.