mouse events in Processing 1.0. and 1.1 are registered on a two pixel step basis,
rather than 1 pixel. The following code is enough to highlight the problem:

void setup() { size(400,400); }
void draw() { background(255); }
void mouseMoved() { println("mouse coordinates:"+mouseX+"/"+mouseY); }

Moving the mouse around will not show any mouse steps smaller than two in both
directions.

This bug may apply to other operating systems, but I've only been able to test it in
Windows Server 2008 (which uses the same kernel as Vista, and so should probably
be treated as a report on Vista).

that's your OS. at least in earlier versions of windows, you had to change
a setting in the mouse control panel to say "increase pointer accuracy" or
something like that.