Photoshop Elements 10 option-click issue

New install of Lion Server on a Mac Mini.  It appears that the option-click key stroke to select a area of a photo to clone is not working.  I get the error below on Elemens 9 and 10.
Could not use the clone stamp tool because the area to clone has not been defined (option-click to define a source point).
Could this be an issue with the Magic Mouse?  i used Systems Preferences / Keyboard Prefernces /Show Keyboard viewere to see that when I depress the 'option' key it is actually being depressed.  Is the click on the mouse being 'recorded'?
I would just give up and buy Apeture but I have too much invested in Photoshop (software and knowledge).  Where should I complain about this issue?  Apple Store?  This forum? 
Could this be an issue with the Magic Mouse?  I'm going to install 10 (have 9 installed today) on my Mac Air and use it without a mouse to see if I have the same problem.
Why do I feel like I am blazing trails?  I hate that feeling. 
Thanks in advance.

Installed Elements 10 trial on my Mac Air no issue.   Converted my Magic Mouse over to my Mac Air via bluetooth.  !AH AH!!!!!!   Same problem.  I think I have isolated it to something to do with the Magic Mouse.  Tomorrow I will go buy a wired Mac Mouse at the Apple store to see if I have the same issue.
If anyone has some suggestions on how to isolate even more to the Magic Mouse then please step up!

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