I'm facing the same issue on my PC.
The issue occurs after a few minutes to a few hours.
When the issue has occurred the mouse cursor works fine on the Ctrl+Alt+Del screen.
When the issue has occurred and I open Task Manager from the Ctrl+Alt+Del screen the mouse curser continues to work normally until I click anywhere.
When the issue has occurred and I lock the PC the mouse curser continues to work until I unlock the PC.
When the issue has occurred it affects all pointing devices I have tried.
The only temporary fixes I have found so far are to sign out or to restart the PC.
Or going further like I did to uninstall the update and pause updates.
Pointing devices I have tried:
Razer Mamba Elite (my default)
Microsoft Basic Optical Mouse V2.0
Logitech Spotlight (presenter with pointer device capabilities)
I use PowerToys but the issue also occurs with all mouse features disabled.
Turning off Bluetooth also doesn't fix the issue (in case there is an issue with a paired input device such as my Xbox controller).
Repairing Windows also didn't help (in place reinstall of 23H2 through Settings app)
Hardware (in case that helps)
AMD Ryzen 7 5800X
Asus ROG Strix X570-E Gaming (latest stable BIOS from April 2024 version 5013 and latest AMD chipset drivers, latest Intel WiFi/Bluetooth and Ethernet drivers, lastest Realtek Audio and Ethernet drivers)
Zotac GeForce RTX 3070 Twin Edge LHR (lastest drivers 565.90)
Elgato HD60Pro (latest 4K capture utility)
Razer Huntsman (latest Razer Synapse software 20241011 and firmware)
Razer Mamba Elite (latest Razer Synapse software 20241011 and firmware)
Some of the software mentioned above was outdated when the issue first occurred but updating to the latest versions didn't fit it.