This is the final/full version of Diablo. From your description it seems like you have some Mouse Lag issues.
The same thing happens to me, on some PCs it is caused by V-Sync being turned On, but if it's Off you get Screen Tearing and such.
When you run the game it loads a launcher with different options:
Diablo
Diablo (Classic)
Hellfire
Video Settings
You could try to run the Classic Diablo, it might run better, or you can try different options in the Video Settings and see what works best for you.
One way is to run it in Windowed Mode (you choose the resolution) with V-Sync Off.
Another way would be to run it Fullscreen but with a different 4:3 resolution (1024x768, 1440x1080, etc.) that has a higher refresh rate (to try to minimize screen tearing) and with V-Sync Off.
Post edited August 25, 2021 by Kobi-K