Welll I do that all the time, and I have never noticed the alt behave any different than if I had mouse and keyboard attached to the alt machine.

Imagine....the bombing and egg daily quests.....be kinda hard without it working well....for quite some time one of my alts was the only one with an epic mount, so I used that char for these dailies

Oh....in case it matters....it works on vista/xp mixed.....it also has allows copy/paste (using CTRL C/CTRL V) of both text and also files....I find this more useful than I thought in the multiboxing scenario.