Mouse "works" but it will require that the VM "capture" the mouse pointer and often doesn't move the same way it would on the host because the VM is having to translate the messages it's receiving from the host OS in to emulation of a classic PS/2 mouse.
A VM integration driver allows the host to just pass through to the guest the absolute position of the pointer over the virtualized display and the button/scroll events which allows it to not need to be captured and movement feels natural to the host system.
Newer guest OSes that support USB HID can generally support an absolute input mode which was intended for drawing tablets and it'll work well enough, but it's a bit of a hack and requires updating the USB descriptor any time the display resolution changes to keep them in sync so a VM integration driver is still nice to have.
A VM integration driver allows the host to just pass through to the guest the absolute position of the pointer over the virtualized display and the button/scroll events which allows it to not need to be captured and movement feels natural to the host system.
Newer guest OSes that support USB HID can generally support an absolute input mode which was intended for drawing tablets and it'll work well enough, but it's a bit of a hack and requires updating the USB descriptor any time the display resolution changes to keep them in sync so a VM integration driver is still nice to have.