I had also posted this same camera issue on the tracker. Sadly this issue is also in Carrier Command: Gaea Mission. I recently tried out the demo and found I had to run in win98 compatibility mode and had the exact same mouse/camera issue there as well.
No word on a fix for this aside from remapping to key controls? Would that help for Carrier Command: Gaea Mission too? Would like to play both games as they're meant to be played.
Bug ID: 0000111