Some time recently, the behavior for "activate a window by hovering over it" in the mouse cursor settings changed. Now, if you are touching the touchpad while selecting a window in the task bar, it moves the cursor to the center of the window. If you're not touching the touchpad when selecting the window, the cursor doesn't move. Likewise, if touching the touchpad when selecting the X to close a window, the cursor jumps to the task bar. When turning off "active window on hover" the cursor does not move regardless whether the touchpad is touched.
Snap to default button is not on.
This has not been the behavior in the past. Previously, "activate window on hover" did not move the cursor in any circumstances. It does not appear to make sense to tie these unrelated behaviors together, and it is also strange that the cursor only moves if you are holding your finder on the touchpad when selecting the window. It seems like a recently introduced bug.
It happens on multiple computers from different companies. I've had the computers for years without this happening. So it's not hardware. It started happening on both computers within the last several months, and appears to be related to a Windows update.