Try a known working USB mouse or a new one. XP works fine with a USB mouse. If that is all that took a beating, and it still will not work with internal mouse, you could take it apart to clean. However, I would not worry until some other functions of the keyboard fail, then clean it. If you still have warranty on the laptop, see if they will service the unit. Kids will test your hardware again, probably.
My 2 yr old daughter thought she would test my PC hardware skills, my shaking her drink all over a laptop (IBM Thinkpad T22). The laptop was on at the time, with an external mouse connected to the PS2 port. As soon as the problem was discoverd, the laptop was stood on its side, on the kitchen worktop (external mouse was unplugged), and the system was shutdown. Now the mouse trackpoint no longer works; neither does a mouse on the the PS2 port. The PC is running XP Pro, and this reports that the PS2 mouse is working correctly.
I am running out of ideas for things to check (the keyboard works fine), so would be greatful for any suggestions.