Magic Mouse suddenly not working well

Hey guys!

About 3 years ago I bought an early 2009 24" iMac with the wireless option, it came with the wireless Mighty Mouse. About 5-7 months ago I got sick of the scroll ball getting gummed up so I purchased a Magic Mouse.

The Magic Mouse has worked perfectly since the day I bought it until earlier today. I have upgraded the OS many times during the period I have owned this iMac, but I never had a problem with the mouse. I currently have Lion installed which has been working fine for months.

Today it all fell down

All of a sudden the mouse became less responsive. It still works, but not as well as usual. It's hard getting the pointer across the entire screen with short motions like usual. It also feels like there is a hair or piece of dust stuck under the eye.

I haven't made any changes to anything. I checked all the settings and they are the same. I blew out the eye and cleaned it with a Q-tip. I visually inspected it and there is no debris in there nor any scratches.

Any ideas why my mouse is not working properly all of a sudden?

Thanks!