My problem is in regards to accessing a USB device within my virtual machine. More specifically, my external hard drive (and other devices). Each time I plug in the device the keyboard and mouse instantly become unresponsive even after removing the external drive. I have installed the expansion to enable the use of USB 2.0 devices as well as created filters for the mouse, keyboard, and external drive. I have heard that version 3.0.6 does not have this issue, but have not had the opportunity to test this theory. My host computer runs on Windows 7 and my virtual machine uses the portable version of Virtualbox 4.1 with XP OS.
personally i would update your Virtualbox to the latest version and see if you have the same issue. current version is 4.1.18.78361 however you refference an older version 3.0.6 !
A portable version of VirtualBox? Anyway, probably there is your reason why it is not working. Just install the latest original installer and try again.