Just thought I'd mention that when I turn on Hardware Cursor and have a 'mouse over hotspot' cursor set to 'animate' it has a funky glitched overlay which looks like a corrupt image instead of the intended cursor. With the animate disabled it doesn't happen.
Now this might be my GPU mucking about as I have 2 (Quadro 2000 and Quadro 4000) running 3 displays. I've never had any cursor glitches with this set up in the past.
I'm in the process of backing-up my game for an upgrade to v1.39b to see if that helps.
If that doesn't then I'll reboot and give it another whirl to see if its a driver crash. Come to think of it I haven't updated those for a while either!
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