A colleague mentioned this just before christmas but I hadn't got round to investigating further or blogging about it as the software didn't appear to be released for general public download at the time. Apparently from version 5.3 onwards of the Intellipoint software, there's a magnify function. Version 5.5 for Windows 32-bit operating systems is available from here.
This is a really neat utility if you ever do presenting and need to zoom in on a particular area of the screen to highlight what you're talking about - in a demo for example. To configure it, in the control panel mouse applet, assign one of your mouse functions to the "magnify" feature.
Once done, simply select the assigned action to turn on the magnify. You can use the wheel to change the level of zoom or hold the action button to change the size of the zoomed area. Neat :)