Check this out: https://askubuntu.com/a/157426/1746598 its about unclutter, an app that can hide you mouse after inactivity.
This command will hide the mouse instantly
unclutter -idle 0.01 -root
So, after hours of messing around, I've been able to solve the issue:
After connecting the usb dongle, wait a few minutes, then restart the driver
sudo rmmod usbhid
sudo modprobe usbhid
And it solved ...
2 years and 3 months after asking, I think I finally got it working! 🎉
Thanks so much to @Raffa, @Oratorium, and @emk2203 for the guidance.
I created this file: cat /lib/systemd/system-sleep/restart-...