These settings can be found under Edit--> Setup -->Comp Interfaces.
This lets you predefine the references you can use for assembly. Expand out the "Assembly Settings" option and you can establish rules for the assembly features as well. These rules aren't permanent (you can manually set whatever reference you want), but they help Pro/E make a decision as to what to use in the assembly.
To do the cursor thing: In the file browser (model tree window) browse to the folder where your file is, and select the folder so you can see its contents in the web browser window. Select your part, and simply drag it onto the location you want it to show up in your assembly. It won't be attached to the cursor like you asked, but I think this is what you meant.
A caveat: This doesn't work so well, in my experience. I've found that Pro/E rarely gets it right the first time, and you end up having to browse through a series of possible assembly conditions. Adding rules in the Assembly Settings makes your odds a bit better, so you may want to plan that out in advance.
Here's a good trick if you are assembling a lot of the same part:
Assemble the part once, then select the part, and hit Edit--> Repeat. Then choose only the references that differ (i.e. if you are assembling a series of bolts that mate to the same plane, only choose the axis), and then hit 'Add' and start picking axes for the new bolts to be placed. This is really useful to me when I'm making assemblies from plates (usually dies) that don't have hole patterns.
Good Luck in 2006
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