I guess by disabling hotplugging you're trying to stop this in the Xorg log:
Hotplugging is on, devices using drivers 'kbd', 'mouse' or 'vmmouse' will be disabled.
The 'mouse' driver accesses the mouse directly from the serial devices like in Juanitos configuration, but it's being disabled.
The other drivers rely on the Linux kernel having detected/configured the serial mouse correctly as
described here. But that page doesn't mention serial mice.
I wonder if the Linux kernel's serial mouse driver ("sermouse" - built into the kernel according to the "CONFIG_MOUSE_SERIAL=y" settings in
the build configuration) isn't working, so the only way is to force Xorg to access the serial port directly via its 'mouse' driver (maybe by not loading either xf86-input-libinput or xf86-input-evdev but just xf86-input-mouse)?
It sounds like if the sermouse driver is working you should have a /dev/input/mice device that can be used like a PS/2 mouse by X.
I gather you can also check the Linux serial mouse device by loading libinput.tcz and running:
sudo libinput list-devices
And see if it lists a /dev/input/event* device that matches your serial mouse.