I have a similar issue.  Laptop is ASUS C90S running 64-bit Ubuntu 10.04
with GeForce 8600M GT and 195.36.24 driver.  With external monitor in
"Separate X screen", mousepad cursor gets trapped as soon as it's moved
to the external monitor desktop.  Oddly, my wireless mouse, when it's
working (flaky bluetooth support!) moves effortlessly between desktops.

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nvidia dual monitor seperate x server mouse cursor gets stuck
https://bugs.launchpad.net/bugs/565697
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