Same issue using kvm.
Attached is the VM's Xorg.0.log
** Changed in: qemu (Ubuntu)
Status: New => Confirmed
** Attachment added: "xorg.log"
http://launchpadlibrarian.net/16279873/Xorg.0.log
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Mouse stuck in lower right corner in Intrepid installs in qemu on hardy
https://bugs.launchpad.net/bugs/251473
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