I get into the game and everything appears to be working fine, but then on the menu my mouse just jumps to a corner and then stops moving, anybody have any solution for this?
I would just play it without DOSBox, but the music doesn't work and I get weird graphical issues.

Hmm, all i can say is that it works perfectly whit my mouse on my computer.

do you have a joystick attached (or remains of that in the configuration panel) ?
Does pressing ctrl-f10 help ?