I just had a similar problem. I was able to get it fixed by uninstalling the driver, unplugging my tablet, rebooting the computer and then installing the newest driver. While trouble shooting, I found a blog post that explains how to pull the pen apart and glue the broken 'sensor' back together. Search for "Fixing a Broken Wacom Pen" if you think that might be the problem.
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Wacom Bamboo.
Pen stopped working. Eraser hovers/clicks fine. Pen end clicks on hover. Pen not dropped. WTF?
i dropped mine alot but i have the same problem. >_<
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