I'm on the laboratory chapter and I seem to have reached a wall due to a bug that I'm having.
Whenever I move the cursor around the screen it goes in and out like a flickering light. For the last chapters it wasn't game breaking. But the puzzle to unlock the door using the chalk boards is impossible.
small spoiler for puzzle:
The flickering cursor prevents me from seeing what letters I'm hovering over and on the board closest to the door, I can't even see what letters I have along the bottom to unscramble.
end spoiler:
Is this bug fixable or some kind of workaround available? If not then I'm effectively stopped from playing the rest of the game.
If it helps I'm on XP sp 3, nvidia gtx 260 , 4 gigs of ram , and an amd X2 4400 processor.

@jab: Wow, that's quite far through the game already! I remember the section when I finished the game like ten years ago, but am still in chapter 2 of the GOG download. Will let you know when I get to that section, but can't promise anything soon.
Have you tried running it in a window? I think one of the Random Crash threads recommended that and gave the correct string to run.

I had nothing better to do last night :)
Good news, switching compatibility to win 98 fixed the cursor flickering, however the last chalkboard is not showing the letters I clicked on so I'm sending a message to support now.

Yeah, I'm having the exact same problem. It would be great to see this fixed.

I was getting the same annoying flickering and read on another thread that activating Win 98 compatibility will fix it, and so it did. If you don't know how to do it, right-click on the Sanitarium shortcut and select Properties. Then click on the "Compatibility" tab and select Windows 98 / Me.

Are the letters just not showing or does the game not acknowledge them at all? I think Max reads the whole line out when it's all done. I think I can even remember what the line was...

The letters aren't showing up at all at the bottom on the third chalkboard. I know that I'm clicking on the right letters as the cursor changes to the hand icon when I'm over it and goes back to a cursor after I click on them. But no letters are showing up below. For the first two boards I was able to manage with a flickering cursor as the letters were showing up below.

I was having this problem as well, and I think I found a solution. The "windows 98 compatibility" fixes the mouse flickering, but the third board won't show the letters if you have already used the board before doing the win 98 fix. The solution is to load a save before you've used that board, and have the win98 fix on. This worked for me, so give it a try!

That's not good I only had one save, I did have a quick save but I can't seem to get it to load.

In the Load Game menu there are 24 slots for saved games. The 25th slot is for the quicksave. You have to manually save the game from the menu (ESC from the game then select a slot from the 24). Quicksave is working by pressing SHIFT+s during gameplay, but you have to manually load this quicksave slot from the menu.

I tried it again and the puzzle did work this time when I was in windows 98 compatibility from the start.

I had the same problem and ended up starting the game with Sntrm.exe and not using dxwnd and I was able to complete the puzzle. In fact it seemed to clear up many of my other crashing problems.

Thanks, Blinky, this time I was about to give up playing Sanitarium (before getting insane), but your solution worked for me too. The funny part is, the game is so good I keep looking for solutions for the bugs so I can continue playing it. I wonder if it was underrated at its time, because it never got a sequence.