The on-screen keyboard doesn't exactly not work. It just doesn't work in the case you described – it prevents starting a new map. Inside the game, it works, but not fully. You can type names for saves and replays, although it's very inconvenient. As for using it as hotkeys in the game, I haven't tried; I simply find it hard to imagine this acrobatic feat. As I already wrote, the mouse is quite sufficient. The interface is well designed for it. Regarding config files, I would also like to know what can be changed.
I installed the app on my tablet and Windows Phone and turned my phone into a mouse:smile04:. It didn't work for Heroes 5, but out of curiosity, I installed Heroes 6, and not only did the tablet handle it, but the phone also worked perfectly as a mouse:smile03:. So, I'm playing them now and not worrying about it:smile03:.
Added after 7 minutes
And regarding your question: in the game folder (or in My Documents) in the "profiles" folder, there are two config files. Have you tried opening them with WordPad and searching for "mouse," "sense," etc.?