I've tried every possible combination. All of them leave artifacts behind the cursor. I've even asked the dgVooodoo2 developer and he said it was because of how the game itself works.

I didn't revive this thread to be argumentative though, but because I noticed while antialiasing works on my Windows 10 setup and not on my identical Windows 7 setup, having the traditional 2D objects flickering in and out on the Windows 7 setup.

So I thought, maybe it isn't purely a driver issue and could be a DirectDraw/Windows issue. So there's a few ddraw compatibility tools and one of them is DDrawCompat. With the latest unstable build of that, antialiasing works with Nvidia cards.

Of course you still have to rename game.exe to something else to avoid the Nvidia profile. You probably also want to use Nvidia Inspector to choose a supersampling only AA mode.

I want to mention I actually completed the game using this setup with slight pixel glitches following cursor. It didn't bother me too much as I just stopped paying attention to them after some time, but for perfectionists that my be a show stopper.

Got AA working without cursor trails by making sure AA is off in dgvoodoo then using nvidia control panel to enable
Antialiasing setting to 8x and Transparency to 8x.

Tried all the dgvoodoo AA settings but all had cursor trail.

Also i could never get AA working without dgvoodoo error free. I always had missing terxtures holes in characters

edit:

Forgot to mention I also have DSR set to 4.00x and DSR smoothness set to 33%.
Not sure if DSR helps with AA problems but having both on i have no missing menu text, missing objects or holes in characters and no mouse trails

Here you go...

https://www.gog.com/forum/the_longest_journeydreamfall_series/the_longest_journey_1999_and_fsaa_working_great