I had Mirena for almost four years, and of all the BC methods I have tried, it was the best. Good sex drive, no weight gain, and no AF after about 3 months! That was the best part.
They say they don't know how Mirena works, but I think I did ovulate on it. I am very sensitive to hormonal fluctuations (in terms of sex drive) and I felt absolutely normal while using Mirena. Oh yes, and I think the spotting you are experiencing is related to an irritated uterus/cervix from the insertion. It can take a while to settle down, then you should notice your cycle returning to normal, and if you're lucky, gradually tapering and getting lighter, and eventually no AF at all.
Sorry I couldn't be more help! Good luck!
Misti, mom to DS (12), DS (9), DD (3), and Mr. Man (October '10)!