I have a hunch that its disappearing has something to do with the BASS default template but I've looked around for quite some time trying to find where to toggle it on or off. I can select a dialog option which lights up but the cursor is invisible. Thanks!
This was actually a mistake in the template that the cursor sprite wasn't set.
To fix it you can set the sprite for the 'cursor' pointer to sprite 2061.
Or you can download the newer templates from here (https://github.com/adventuregamestudio/ags-templates/archive/master.zip).
Or you can upgrade to the latest AGS version which includes the updated templates.
Oh, yes, that solved the problem. Wow, I guess this is just another reason to stay up to date on your software. Thanks so much for your help.