Just so you guys know, i finally figured out what the problem was. This might be good information for anyone else who could have this problem in the future if they ever decide to do what I did. Ok, so my laptop has a resolution of 1920x1200 which is what I keep it at all the time. No problem right, wrong. I have a VERY high difficult when it comes to reading at the size. So what I did was I went the the "personalization" settings in vista and turned up the DPI settings. This was my exact problem.
Apparently, Vista has a bug that will not let you move around in camera mode if you have messed with ANY of the DPI settings. It ends up screwing up hammer. Wish I could find a fix for this since I have to change my DPI settings everytime now before I start using hammer. At least I know though right? Anyways, anyone have any suggestion of how I can increase font size/everything on the computer so it is readable while still have my SDK work and not spin? If not, then keep in mind that if anyone changes their DPI that hammer editor is not going to work. A good note to maybe put into valve as a bug or something.
Thanks for the help anyways guys,
Saint