Try updating nautilus. I believe that at least part of the problem was:
https://bugs.launchpad.net/ubuntu/+source/nautilus/+bug/1071922 
which has been fixed recently in 12.04 and in Raring but not in 12.10. This was 
a bug in nautilus rather than in Xorg. If it works in nautilus "list view" but 
not in "icon view" then it is probably the nautilus bug.

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https://bugs.launchpad.net/bugs/1002788

Title:
  Using the touchscreen breaks normal device left clicking

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