I use that same KB, with the touch pad and I know if I accidentally brush the touchpad while using normal controller method the cursor stays in the center and I can no longer select items. Usually I just switch the kb on and off and things return to normal. I think the game tries to switch to virtual mouse mode automatically when it registers touch pad movement. It might also be slightly janky due to the PS4 controller having a touchpad as well. Don't know if this insight helps. Hope your issue gets resolved.