Occasionally in Jaguar (10.2.2), Classic goes screwy--very very screwy. Mouse clicks start to bomb applications, and may crash Classic and (twice in my experience) do Very Bad Things to OSX itself. Fortunately, there's an easy fix.
When mouse clicks start to go bad, load up the OS X system preferences panel and select Classic. Without doing anything else (leave Classic running), choose Rebuild Desktop. This seems to restore sanity to Classic without any further ado.
[Editor's note: I haven't had any such problems with 10.2.3 (yet?), but then again, I seldom run Classic any longer. If you do and you've had problems, please post if this hint helped resolve your problem.]
Mac OS X Hints
http://hints.macworld.com/article.php?story=20021222135557927