Does anyone know how to fix the problem of the flickering pointer. As soon as I start the game, the pointer flickers or fades in and out. This can get very annoying, and was wondering if others have had the same problem. I have an NVIDIA card, so I don't think that is the problem.

Yes this is one of the official issues Black Isle talk about. If you open your IWD2 Readme file they have a section called 'Known Issues' which addresses the mouse pointer leaving artifacts on the screen. Theres an option called BLT software which they will direct you to toggle in order to fix graphical errors - but read the readme file first before you change anything so you can be sure this addresses the problem.
If this dosent fix it try the Black Isle tech site where you can talk to the producers of the game and they will try help you sort it. Good luck!

also, remember, if you have anything other than standard windows cursors, they will cause the same effect.
so if you've tried everything else, but still have the problem and ARE using special cursors, consider changing to the standard windows ones just for gaming.

V***V

I had this problem with my nvidia 64meg card on bg2, i *think* the way i fixed it was by changing the color mode the game ran in... to do that just incase you dont know start the game up, click the options tab, chose graphics, then the third choice down... color depth it is probably on 16, switch it to 32, and if its on 32 switch it to 16... let me know if it works :)

No, it hasn't helped. I tried changing the color depth, switching between windowed and non windowed mode, turning on the software option for glitches, turning off all the programs in the background, and nothing helps.

I'd suggest the Black Isle technical forums.