Thanks for the link, Purge. Tried it and it says no problems detected. Still getting that USB device connect sound though.
Have you tried to use other USB mouse or keyboard? Problem like this can also from faulty USB devices.
If you have another USB keyboard, then try to use that and see if the problem go away. If not then you try replace the USB mouse. If you still have problem after both keyboard are mouse are replaced then at least you know the problem is not with the devices but with the computer (either software or hardware).
That's a good idea, but I don't have a spare keyboard or mouse. I'll try to dig some up.