Yes it's intentional since some releases ago, but using win32 as userprovider it hides. Still works in the normal mame and worked that way in 264 mameui. Know that Happ was messing around with the mouse pointer, so who knows...
Anyway, anyone can confirm the controls for mouse are working properly in shooting games like operation wolf?
Edit: Can't move the crosshair in mame, so it's a mame bug too...