Originally Posted by Thunderbird
He is using 'separate' X screens which he set up correctly. This way both TV and LCD get their own X 'desktop'. The task of the nvidia drivers in conjunction with X is to provide a mechanism for displaying images on a display and providing keyboard/mouse support. On top of X you run a window manager and applications. The task of the window manager is controlling the positioning and more of windows.
The thing you want (limiting the cursor to the LCD) would be a window manager issue I think. Not sure if any window managers can do this though. Else there's no solution for you.
What he wants is two separate X screens.
See Appendix P of the README that comes with the nvidia drivers: