VoiceOver moves mouse cursor when recording screen, but not in general

Hi all,

I use macOS for testing website accessibility. When I navigate with VoiceOver on my Sequoia (15.3), VoiceOver does not move the mouse cursor. However, if I record screen, VoiceOver will move the cursor all the time with it. When I open VoiceOver utility the settings are the same as when I'm not recording. I tried using shortcut VO+Shift+Fn+3 to turn off mouse tracking while recording, but nothing happens.

The problem is that some elements have onmousedown trigger event and when the mouse is moving with VoiceOver it may trigger an unwanted action and it makes my testing and actions invalid.

Also this issue occurs not only with Quicktime player, but with all other screen recording apps. This makes me think that it is a VO issue in the settings, but somehow I can't seem to find the issue. I tried resetting VO settings, tried resetting computer, the only thing I haven't done is formatting the PC - which I would like to avoid since it is company's iMac.

Does anyone know what settings might be wrong or what I could do? There seems to be no topic related this specific issue.

Here are the attachments of the VoiceOver Utility > Commands and Navigation tab:

Thanks!