I was charting sectors in UIT space Friday night, logged off in an empty sector, downloaded new patch Saturday, logged back in at the same sector, and now I am adrift. It's like my mouse and keyboard are unplugged. I tried my alts, when I am in a station things work great, as soon as I launch I am once again powerless, just sitting there. I then created new characters, and the game told me they were the first ones on my account. So as I left the station on the first tutorial I just kept flying, and couldn't do a thing. Also, all the settings changed back to the default.

It sounds like the update nuked your keyboard bindings. That would explain why it seems like your mouse and keyboard are unplugged.
Go into Options->Controls and press the 'Defaults' button in the bottom right of the screen. Optionally, you can go to the Keyboard tab and manually bind all the keys you use.

Thank you for your time raybondo, worked like a charm.