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The jumping cursor problem can be due to a number of problems and settings, and so you will have to figure out which solutions will work for you by trial and error. Here are a few solutions that has helped others to get their issue resolved:
1. UNCHECK HIDE CURSOR WHILE TYPING
Go to control panel - "printers and other hardware" - "mouse" - "pointer options" - uncheck "hide pointer while typing" then click "ok."
2. CHANGE TOUCHPAD SENSITIVITY
Adjust the touchpad sensitivity (or set it to inactive while typing) by going to Control Panel - Mouse, or just disable it entirely if you use a mouse.
3. DOWNLOAD DRIVERS FROM www.support.dell.com
Download updated drivers for touch pad and mouse (Input devices)
4. SCAN FOR VIRUSES
Check for spyware, viruses.
This doesn't answer the question. I have the same problem. When I hit caps lock, an icon appears in the lower right window indicating that the caps lock is now turned on or off. That icon, however, becomes the active window. That's why it's required to manually use the mouse to return to the document I'm typing. The icon is helpful, but it shouldn't become an active window. How can I disable that?
I have the exact same problem with my caps lock key automatically exiting the program window I am in when I use it and having to enter back into the window I am working in.