Well, I guess I'll never know about the numlock. M$ newsgroups aren't answering either. I've decided a Microsoft warranty is worthless as far as csutomer support goes.
Now I've discovered another quirk. If I plug in my U3 usb drive the mouse (only) stops working until next reboot. If I plug in my Canon camera it also stops working for the duration that the camera is connected....why on Earth would usb applications interfere with Bluetooth? By the way, all through this the mouse remains connected in the Bluetooth devices window.