The Status LED's do not connect to the D+ or D- pins.
You can use any pin besides those.
And your problem is definately in the PC program you just posted.
It does not update anything until it receives a report from the PIC.
Even the clock in the bottom right corner only updates on each report from the PIC.
If you make it so the PIC does not send anything, then the PC program will send updates.
But as soon as the PIC sends something, the PC program will never send anything again.
That program needs some serious work.
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