got the answer for my own question:
adding locale=fr_FR i8042 to kernel line solves the problem.
this is done as:
(need to be root)
vi /boot/grub/menu.lst
and modify
title Fedora (2.6.23.1-42.fc8 )
root (hd0,5)
kernel /vmlinuz-2.6.23.1-42.fc8 ro root=/dev/VolGroup00/LogVol00 rhgb quiet
initrd /initrd-2.6.23.1-42.fc8.img
to
title Fedora (2.6.23.1-42.fc8 )
root (hd0,5)
kernel /vmlinuz-2.6.23.1-42.fc8 ro root=/dev/VolGroup00/LogVol00 rhgb quiet
locale=fr_FR i8042.reset
initrd /initrd-2.6.23.1-42.fc8.img
now reboot
