Virtual mouse driver

I need to implement a touch screen driver that reads data from an SM bus. Since I'm new to driver development, I decided to start with something simpler first. I just when to create a virtual mouse driver that will send fake MOUSE_INPUT_DATA.

I started from the moufiltr sample and was successful in creating a driver that loads as a mouse (in "Mice and other pointing devices"). My driver saved the callback data passed by mouclass when it sends IOCTL_INTERNAL_MOUSE_CONNECT and calls this callback function every second with a fake mouse data. This seems to work fine as I see that the callback has consumed the data sent. However, the mouse never moves...

It looks like Windows system is not reading from my mouse driver. Any hint about what could be wrong or missing?