This bug was fixed in the package xorg-server - 2:1.10.1-1ubuntu1.1

---------------
xorg-server (2:1.10.1-1ubuntu1.1) natty-proposed; urgency=low

  [ Chase Douglas ]
  * Fix masked transformed valuator handling (LP: #774938)
    - Added debian/patches/503_fix_masked_transformed_valuators.patch

  [ Timo Aaltonen ]
  * Add 218_randr-check-rotated-virtual-size-limits-correctly.diff
    - Fix rotation with nvidia driver. (LP: #740933)
 -- Timo Aaltonen <tjaal...@ubuntu.com>   Wed, 18 May 2011 20:23:56 +0300

** Changed in: xorg-server (Ubuntu Natty)
       Status: Fix Committed => Fix Released

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https://bugs.launchpad.net/bugs/774938

Title:
  Erratic cursor movement when using "Coordinate Transformation Matrix"

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