Are you sure you are not pulling too much current? How much current does the MAX232 with its capacitors requires? Maybe the teensy is constantly rebooting (brownout or whatnot)? (hence the flashing?) Put your multimeter in series near the PS/2 plug (yeah, that requires disconnecting a wire unless you are a happy low-power clamp multimeter owner).
What is the configured mAmp power in your WaxBee template? This is how much power you are requesting from the PC -- and this can be a very small number like 20mAmp! In case you do not know, this is located the WaxBee template -- Edit the "USB Device Descriptor" (either through the WaxBeeConfig software (recommended) or open directly with a text editor while WaxBeeConfig is not running). There should be a comment in there -- If I recall correctly, the number configured in there is supposed to be half of the mAmp (50 for 100mA). (watch that it could be written in hex -- WaxBee support both hex and normal 10-base numbers for us mere mortals).
Can you try with the PS/2 connected to the "normal" PS/2 plug instead of USB? Is this valid electrically? (thinking about ground here).
I saw you already tried the debug template and HID_Listen. The alternative is to program the virtual serial port .hex (download from waxbee site) -- then directly hook it with RealTerm (like you would normally do when the tablet is hooked to the PC directly, but using the COM port associated with the virtual serial port). On Windows, you may need to install a .inf file. (more info on the prjc.com site: http://www.pjrc.com/teensy/usb_serial.html
) -- maybe you can analyze the traffic to see if something is weirdly reported.
What baud rate speeds is configured in the template? I assume 9600 (initial) and 19200 (normal) bauds.
Normally the teensy will try to reduce the speed to 9600 baud before augmenting it back to 19200 -- this is to attempt to catch the case that the board might already be in 19200 baud (already powered and configured). If the board was configured to another (neither 9600 nor 19200 then the teensy might not be able to talk to it and will fail to initialize it).
Normally you would connect the USB connection power *last*. I mean, first connect the DB9 and PS/2 and finally connect the USB (to essentially power up the teensy and the tablet together). On top of that, PS/2 was never meant to be hot-pluggable and neither RS-232 either btw -- just that RS-232 drivers are known to be resilient).