This is a really weird, but very annoying problem.
Basically, I have a Sony Micro vault 256MB flash stick, which used to work fine and still does on all computers apart from mine! Thinking that the device had malfunctioned (as windows used to bring a pop-up when you plugged it in saying "device has malfunctioned" I purchased a sandisk cruzer titanium 512MB stick. Again! This said it had malfunctioned.
But the really weird thing is..... My mouse, wireless internet, digital camera and 6 in 1 card reader all work fine and they are all USB devices.