...Is that an XP issue? I'm running Vista, so perhaps the two operate differently.
According to OQO's KB it's an 02 issue:
"Use of the digital pen is supported only in the OQO model 02 computer's native 800 x 480 mode.
The digital pen will work correctly and remain calibrated when working in the OQO's native resolution of 800 x 480; if, however, you use the OQO's zoom feature to increase your display's resolution to either 1000 x 600 or 1200 x 720 (both of which are supported screen resolutions for working in zoomed mode), your pen will not retain its calibration and will not work properly. You can, however, work in zoom mode with the keyboard and mouse.
This article applies to: model 02"