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Hm... I'll have to look into this. Would you happen to have a controller plugged into your computer anywhere?

Yes! However, it didn't work either.

Ah, I got halfway through programming controller support in this update so the game will only let you play with mouse and keyboard if no controllers are plugged in. So try unplugging all controllers then opening the game.

Yep, that did it. LOVE the use of sound cues for the enemies as well.