MultiTouch Vista

http://multitouchvista.codeplex.com/
Excerpt from http://www.drdobbs.com/windows/227701092

The great drawback is that you cannot emulate multitouch gestures with a mouse or a touchpad in your developer workstation. However, if you don't have a multitouch monitor, you still have a chance to test some multitouch gestures without having to deploy the project to the phone. There is an interesting project on CodePlex, Multi-Touch Vista that allows you to work with multiple mice to emulate two fingers on the screen and their multitouch gestures. In fact, the latest version of Multi-How to build a UI from scratch.

Multi-Touch Vista provides a Windows 7 compatible driver that enables multiple mice and is compatible with the Windows Phone 7 emulator. For example, you can use a laptop's touchpad as one of the pointers and a USB mouse connected to the same laptop as the second pointer. (If you're interested in working with Multi-Touch Vista, you can read an excellent step-by-step tutorial written by Michael Sync This tutorial explains how to install and configure the driver to work with the Windows Phone 7 emulator.)