Once upon a time, I was having trouble with the cursor, and I had to set Hardware Accelerated Cursor on or off in some file or reg key... foggy with the deets, sorry.

Moved to Marvin -> Software.

Oh man I forgot about animated cursors. I need to get some goofy themes up and running again! I agree it could be a problem with hardware cursor processing. This is why games sometimes allow you to disable hardware cursor.

I'd think those hardware cursor options are more for 3d cards *COUGH*VOODOO2*COUGH* that can't do a hardware cursor over an accelerated surface (for not being a desktop accelerator) so the game emulates one within its own renderer. I think Voodoo3 even had problems with that feature

Oh yeah that's true too. But aren't there some 2D / Directdraw games with hardware cursor options?

But I do think I remember tweaking video driver cursor settings to make Windows animated cursors work back in the olden times. And for other reasons like Windows cursor corruption.

Microsoft wrote a knowledge base article that may be relevant:
Q123334 - Requirements for Animated Cursors

Thanks STX, that KB was spot on. In my case my HDD was running in compatibility mode. After fiddling with my SATA connectors order, I was finally able to reach a configuration that made Win95 happy and run all HDDs and DVD drive at full performance. The side effect you get is animated cursors running again 😆 Who could guess!

So obviously my next step was to install Microsoft Plus! .. and hoo ray! Everything works great with themes and their animated cursors.