To expand on the accepted answer: While your emulator is running, you should have a narrow panel next to it with buttons for rotating the screen etc. At the bottom of this is an overflow menu which takes you to “extended controls”. The Settings page in here contains the fabled “Disable mouse wheel” switch.
This used to drive me insane – the idea that it is an acceptable default behaviour is ridiculous. Anyway, the switch works and now I can use my emulator again!
