I have a Dell XPS 420 and my mouse pointer is offset.
when i draw a line in mspaint, the line is 1/4 of an inch above the pointer. I had fixed it before by going into mouse properties and choosing "none" as my mouse scheme, but i've had to reformat since then, and the problem has reoccurred. I have used google to search for troubleshooting, and I can find no solutions that work.
I use a kensington ci20 optical mouse, but this problem persists with other mice in my household.
This was a known issue on some ATI video cards in late 2007 - Dell issued driver updates to fix it in early 2008. Assuming you have an ATI card, have you tried updating to the latest driver version from either Dell or from ATI?