Ok, so I can work my mouse and everything in dosbox, but only when I do the alt+enter thing. I mean Daggerfall's graphics are better windowed, but I can't move my mouse in windowed. I mean, I'd happily play fullscreen, but I can't really tell what is what. Help?

Press Ctrl+F10 to bind your mouse in the window. I have this problem on my Vista machine if I run it in a window.

perhaps locking the mouse to the screen using ctrl+f-10 may solve your problem?

(also to unlock mouse do the same thing again)

EDIT* Yojimbeau beat me to it

Thank you guys, it worked. Sorry you got ninja'd, outlander.

haha it's all good. I'm just glad your problem was resolved