If I’m not mistaken, the mouse configuration for kde plasma is saved in ~/.config/kdeglobals, section [KDE]. Check if the custom mouse settings are registered in that file after setting them in “System Settings”, log out, log in, check kdeglobals again. If the settings are the custom mouse settings some other kdeglobals file may supersede the users kdeglobals file. Check the users home directory for other kdeglobals files and if they contain any mouse settings.
If you have eliminated possible other configuration files, and the problem persists, you can try setting the KDEHOME=‘~/.config’ environment variable in the users log in shell configuration file (depending of the shell: .shrc, .cshrc, .tcshrc, .bashrc).
If none of the suggestions resolves the problem try the custom configuration of the mouse in a fresh created user account.