Tried my ClipCursor code and it didn't work at all.
Poked around with the 'Compatibility' settings in the Windows 'Properties' dialog for EventGhost. This is the dialog you get when you right click on the app or app icon and select properties.
I'm running 64bit windows 7 so I tried changing the compatibility modes... no difference, bug still there...
Then I realized that since I'm using this on a 60" display that I had gone into my display settings and setup my text for high DPI (larger fonts) so that I could actually read stuff from my couch.
Turns out the compatibility tab allows you to 'Disable display scaling on high DPI settings'
Checking that fixed the problem. Works fantastically well now and fixed the weird UI issue I was seeing with the splitter bar in EventGhost as well.
Hope this is a help to others.