How accurate can I be with Servos?

mem : you're talking about the sensor from the microsoft mouses that benoit rousseau hacked ?
http://www.arduino.cc/cgi-bin/yabb2/YaBB.pl?num=1154816099
That might work

No hacking required, one can just connect a USB optical mouse like this:
http://www.arduino.cc/playground/ComponentLib/Ps2mouse