Well, this looks wierd.
I run windows xp.
So I'm playing normally one day, and BAM! I drop out to the desktop. I go back into to XWA and it tells me that I don't have a joystick connected. I reinstalled XWA. Same problem. I uninstalled XWA again, deleted the directory, left no trace(save my pilot) on the hard drive. Reinstalled. Still the joystick error!
I tried a different joystick. Same error message. Windows detects it fine. It works in Podracer. What the hell?