should I add my answer that I put into my question as an answer?
http://askubuntu.com/questions/127049/help-trying-to-get-two-finger-scrolling-to-work-on-asus-ul80vt#comment152450_127049
Though I'm not sure if "reinstall fresh 12.04" is a good answer? but it's how I fixed my two-finger scroll error (and my trackpad shows up correctly in xinput list) - I'm sure I probably *could* have fixed it by removing all the relevant packages and config files... (but reinstalled due to messing up ubuntu boot by removing plymouth)