I'd be glad to help anyway I can. Here's what I know so far. I don't think my installation is anything out of the ordinary. I actually have two installs going, just trying to learn as much as I can. I have an interest both for personal use and professionally so I have an installation at work and at home. The home installation is the one giving the problem with the on screen remote. Both installs are based around typical Intel motherboards and chip sets. I have scavenged left over parts for the most part, until I know enough to make some good purchase decisions anyway. I'm more in a proof of concept stage right now.
When I first started working with LinuxMCE I ended up with both CD install media and DVD media. During my learning experience I've had the opportunity to load both a couple times. I would use the DVD for sure but my memory being what it is, I happened to leave the DVD at work when I needed it to install at home one weekend. The install giving me the problem was with my home machine installed from the cd version.
The home machine has a couple older Western Digital hard drives, a 40 gig and a 10 gig. I also use a leftover Maxtor USB 250 Gig drive between home and work. I use the 40 for the OS, the 10 for some audio CD's and the 250 for DVD's. The video originally was an old ATI Rage Pro 128. I managed to pick up a 7300GT fairly reasonably priced and knowing that Nvidea is a preferred video configuration, and that the 7300 gave me more outputs suitable for home display devices, I swapped cards. A couple things seemed to go wrong when I did that, Flicr stopped working, and I'm not sure if the remote problem started then or not.
After I posted, I decided to try a few more things. I ended up re-installing but this time from the DVD. The on screen remote problem was still there. Here's where it gets goofy. Flicr now worked, and the day after I reloaded the OS, I clicked on the screen to get out of the screen saver mode, the screen that displayed next told me that it wanted to reboot. I'm not sure if the system wanted to re-boot on its own or if by clicking over the screen saver the reboot core/hybrid button happened to be underneath that spot on the screen saver. Regardless, after it rebooted, the problem with the remote has gone away. I have no real good explanation for the fix.
So in summery, I had reloaded the OS, this time with the 7300GT installed, left it attached to my home network (w/internet) for a day or two with the same problem, rebooted it, and the problem was gone. I'm thinking that somehow the system was able to update its self but I'm not familiar with how LinuxMCE goes about doing that. I do know that when I installed the CD version of the OS, Kubuntu wanted to update itself before I had the chance to install LinuxMCE. Not knowing any better, I let it update, and of course the LinuxMCE installation wouldn't work correctly. So I re-installed again, refused the update, installed LinuxMCE from CD and went on my merry way.
Sorry for the book, but that's what I recall for the moment. If I think of anything else relevant I'll add to this thread.
Thanks for the reply and hope this info is helpful. If you have any specific questions please feel free to ask.