http://www.tomshardware.com/forum/101956-13-microsoft-sidewinder-precision-joystick not sure what the problem is, but did you install drivers? Does it show up in the device manager when you have it plugged in? did you try different usb ports>?
When i insert my software disk it says not compatible with 64 bit. The device manager shows the hardware and will even test it but the disk wont run.
According to Microsoft it is not compatible with Windows 7 x32 or x64 bit. You might get it to work with the default Windows 7 usb controller drivers but that is it. The software that came with your stick will not work and Microsoft has no Windows 7 drivers for download for that stick.