Make sure your supply voltage from the batteries is high enough. I have a duemilanove and it works fine from USB power, but if I connect to batteries, it behaves strangely if the voltage is less than 7 VDC. I was using a 4 AA battery pack and it doesn't provide a high enough voltage for the board to operate properly. With some peripherals it is okay and with others it isn't. A 9 V battery works well for a short time -- not much capacity. Try using a larger battery pack.