This is a tiny wireless chip, does anyone know where you can buy this chip and how difficult it is to interface it with arduino?
The URL refers to a Logitech cordless optical mouse. Are you thinking of the wireless chip-set that makes the mouse work? If so, do you know the part number of the chip itself?
No, i just noticed that its really tiny and thought maybe someone out there had used something that small for wireless transmitting over short distances....
You mean the USB dongle? There are Bluetooth devices in that form-factor.
do u have any name of such a chip, and have u integrated it with arduino?
There is an Arduino with bluetooth built in. http://arduino.cc/en/Main/ArduinoBoardBluetooth
I suspect any bluetooth-to-serial adapter can be connected to a regular Arduino with minimal hassle, but the link above handles all that already and you don't have to worry about logic levels, etc.
Oh, and most any USB bluetooth dongle should work for talking to it.