The problem seems to be two fold. There is an issue with Fedora 13's X (up to 188.8.131.52). Xinerama is broken and won't allow the cursor to jump from one screen to another out of order. This has been fixed in rawhide with a patch (X 184.108.40.206), details available here:
The second issue is the squares/artifacts that follow the cursor around only on the center screen. As of yet I have not determined what the primary cause is however I am inclined to conclude it is the nvidia driver. This is because I got the same squares/artifacts when I used the latest nvidia drivers on Fedora 11. That is to say, upgrading the nvidia drivers from 190 to 253 breaks my setup. There is nothing in X log to indicate any problems, nothing in messages or dmesg. Is there a way to enable more detailed logging from the nvidia drivers?
As I mentioned earlier, the issue only presents itself at the center screen. There is nothing special about it that I can discern, it is hooked up to the gtx 260. Any ideas, suggestions, are greatly appreciated.