I got it working by following the CX Games 9 Alternate How To here in the Tips & Tricks Tab.
Unfortunately, I had a problem with a 'falling cursor' that loved the bottom of the screen. I've had this problem in a few games. To fix this problem I set the Fallout 3 resolution to the exact resolution on my iMac.
I went to the Apple Symbol in the top left corner and clicked on 'About This Mac'. I then clicked on 'More Info' and Graphics/Displays. I then tried to find my iMac Display resolution in the Fallout 3 options. I eventually selected 16:9 widescreen (2560 x 1440).
Fallout 3 now plays in fullscreen with no mouse troubles.
I've got an iMac 11,3 Intel Core i7 2.93 ghz Quadcore 8gb Ram ATI Radeon HD 5750 Mac OS X 10.6.5
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