it sounds like you are running the game in widescreen as opposed to 4:3, therefore have you amended the .ini file to make the game display in a 4:3 ratio. These are my settings and it calibrates fine with no mouse cursor displayed.
FullScreenWidth=1280
FullScreenHeight=1024
WideScreenWindow=0 ;Set widescreen in windows mode: 0 - 4:3, 1 - 16:9, 2 - 16:10