Here's pretty much everything you need to know.
1) Turn off mouse smoothing and acceleration.
Both of those make software (UT2004 in the first case, your operating system in the second) fudge with how cursor movement is translated from physical movement. With smoothing and acceleration enabled you can never develop muscle memory -- which is where good aim comes from -- because the distance the cursor moves from a given hand motion is entirely dependent on the speed at which your hand moved. This is bad. Seriously bad. Turn them off now.
2) Set your operating system's mouse speed to whatever makes it right in the middle. For Windows that's the 6/11 setting.
This will help ensure the operating system isn't messing with mouse movement interpolation similar to acceleration.
3) Go into your mouse's driver configuration panel and adjust the settings there until the mouse is comfortable on the desktop. Again, keep any sort of acceleration disabled.
If you can adjust the USB polling rate, set it to 250 or 500 Hz. 1000 is excessive. If your mouse is too cheap to have its own drivers and config panel at all then you shouldn't be worrying about being good at video games anyhow. :]
3.1) Ignore DPI settings. DPI is a near-meaningless stat used to sell the latest "ground-breaking" tech to unknowing sheep.
What really matters is the accuracy and speed of the mouse's polling hardware and software engine, and you'll have to do your own research to figure those out since it won't likely be right on the box like DPI will. Set the DPI high or low or default -- it doesn't matter as long as it's over 400. Just keep it comfortable.
4) Avoid enabling v-sync since it causes mouse lag.
It doesn't literally cause the mouse to lag. Instead, it effectively makes you see slightly old data when the game renders to your screen. This makes the cursor feel like it's lagging behind what your hand is doing (i.e. lagging). People will say you can enable triple buffering in your video card's settings to alleviate this lag, but back when I cared about gaming it didn't seem to matter -- v-sync with double or triple buffering both caused lag for me. That may be untrue now given how fast cards have gotten but I don't know. I do know that I've never gamed with v-sync enabled.
5) Ignore all reports of sensitivity numbers from everyone (including me).
The numbers mean nothing. Literally nothing. There are too many variables for them to have meaning. Your mouse's DPI, the mouse driver's speed settings, your operating system speed settings, etc. all play a part in how the cursor movement is translated from mouse to screen.
What you need in order to compare sensitivities with others, then, are measurements of horizontal 360s. Mark where your mouse is, spin 360 degrees in-game, mark where the mouse ends up. This distance will tell you the most about your sensitivity and give you a real-world value for comparison with others.
Back in my own little heyday I was using roughly 9"/360. At my slowest it was around 12 or 13. Toward the end of my UT days and into my CoD days it was about 6". Lower distance equals higher sensitivity, obviously.
6) Do whatever's most comfortable.
Generally speaking, low sensitivity means more precision at range but puts you at a disadvantage up close as you can't spin around to deal with nearby threats. The opposite is true for higher sensitivity -- easy spinning, less precise at range. Obviously, something in the middle will be a little of both. Find what you like and leave it.
Note: This is why mouse acceleration seems good in theory. But it's indeed just theory. In practice, acceleration will end up hurting you more in the long run. Period. Keep that sh*t off.
But it doesn't matter if you go high or low or middle so long as you make it work for you. Some great players have theirs set low; other great players have theirs set high. All that matters is you find something comfortable and stick with it so you can develop muscle memory.
7) Bump the hell out of this thread so I don't feel like I wasted my time.
Oh, hey, 2:00am. Fancy seeing you again.