I too had a similar problem, used a wired mouse with XP and vista and it zoomed perfectly, not only in TurboCAD but photos etc. The I changed to an MS wireless setup and the zoom just seemed to stop working.
I'm not sure how I found it out (or if I had to change any settings), but if I held the Control key and scrolled the mouse it would zoom. Since then I've set the side button on the mouse to the control function and use that when I need to zoom.
Let me know if it works\1