Not to necro this thread, but it seems like the question as to why this happens was never really answered and the original poster is still active on here so I figured I'd shed some light as to what is actually happening.
When you're controlling other PCs with Multiplicity, whether seamlessly or not, your hardware is still processing those inputs on your primary machine. All Multiplicity does is block the callback on the hardware input and use something akin to the p/invoke ShowCursor to hide the mouse on your primary screen while sending the inputs over a TCP network to be processed on your other local machines.
For normal applications that don't use DirectX, this will work fine. But if your foreground window is a DirectX game that is utilizing DirectInput functionality, like EverQuest, mouse hardware inputs will still be processed due to how DirectInput handles hardware inputs independently of Window's own input handler.
I'm not sure if Multiplicity themselves have a programmatic solution to this as I haven't looked in to how to solve the issue, but this is more of a problem with DirectX, or more DirectInput, than it is Multiplicity. They could, theoretically, block callbacks specifically to DirectInput, but I have no idea what language Multiplicity is programmed in (probably C codebase in some regard) so whether or not this is possible for them, or if they even care enough to do so, I am unsure.
Either way, I hope this sheds some light on why this is happening exactly!