Download MS ACT 5.x or 6.0 and create a fix for the game with the flag "HideCursor". Run Compatibility Administrator (and not Compatibility Manager), click on the button "Fix" and follow the instructions.

ACT? Isn't that necessary for Windows Vista and newer? I am using XP, would that wor for it as well?

EDIT: Well, this is more complcated that it looks - that fix although removes the cursor, however, I thought it would be like an installer which overwrites the particular sequence in the game code to remove that cursor once and for good, not an "emulator" through which I have to launch the game, because I can't play it unless I launch it via DXWnd due to standard problems like white screen etc. Maybe if I send you screencaps with DXWnd selected options, you will be able to advise me which options in addition to "HideCursor" I must flag to make ACT fix for running the game properly. What do you think about it?

I don't have this game so I've never tried to get it to work on a modern system but I did have an issue with double mouse cursors with some other wrapper .dll software and the fix was to set the mouse pointer scheme to "(None)" in the control panel. Bit of a long shot I know.
This is on win 7 by the way.

the ACT backend was added to XP with one of the service packs ( SP2? )

A properly install ACT fix will be applied every time, regardless of how the game was launched.

If DxWnd is running in the background...
DxWnd will automatically inject itself into the game process upon creation of the main window, regardless of how it was launched.

Questions about DxWnd should be ask in the DxWnd forums:
http://sourceforge.net/p/dxwnd/discussion/general/

you should not post screen caps of DxWnd option settings.
if necessary, export your DxWnd setting for the game
then upload ( in the DxWnd forums ) the resulting "Star Wars Episode I Racer.dxw"

( I don't have this game... well at least not for the PC )

aqrit wrote:

the ACT backend was added to XP with one of the service packs ( SP2? ) […]
Show full quote

the ACT backend was added to XP with one of the service packs ( SP2? )

A properly install ACT fix will be applied every time, regardless of how the game was launched.

If DxWnd is running in the background...
DxWnd will automatically inject itself into the game process upon creation of the main window, regardless of how it was launched.

Well, it doesn't work in my case. ACT will apply every time, but not when DXWnd is running in the background, regardless of how the game was launched. It looks like DXWnd supress the ACT fix and prevent it from working. When I shut the DXWnd down, the Win cursor dissappears, but without DXWnd the game is unplayable due to white screen bug (I can see HUD, my racer and a piece of track near him, the rest is just all white).

Nevertheless, let's say I can live with two cursors in the game. I started a new campain and finished first two races - The Boonta Training Course and Mon Gazza Speedway. But in third race, thirty seconds after start, my screen just turn all white, I can't see anything but the HUD. Music and sounds seems to be OK. Do you know guys how to fix that?

Try creating a fix for dxwnd.exe using the same flag. However, since dxwnd forces the game to run in windowed mode, it might not work and the developer will probably have to implement mouse capture for the desired effect.

filipetolhuizen wrote:

Try creating a fix for dxwnd.exe using the same flag. However, since dxwnd forces the game to run in windowed mode, it might not work and the developer will probably have to implement mouse capture for the desired effect.

I don't play it in window mode 😉

Nevertheless that's what the application does. It might be still running in a fake full screen mode.

that is no longer true for the newer builds

So, it's worth to try the fix for the wrapper.

OK, I'll try it then.

Anyone can help with "white screen after 30 seconds" issue, too???

I tried filipetolhuizen's advice to create a fix for dxwnd.exe, but it still doesn't work.

EDIT: I just played with screen options a little bit and finally I have only one cursor visible. Thanks for your effort, guys!