Okay, this is what i've managed to do so far:

http://jpoel.byethost15.com/Swim/Swim_example.swf

But as you can see it isnt smooth at all! Does anyone have any better code i can use?

This is the code i have written to do it:

Code:
var px = mouseX;
var py = mouseY;
this.addEventListener(MouseEvent.MOUSE_MOVE,moveMouse);
function moveMouse(e:MouseEvent):void{
	var a = mouseY - py;
	var b = mouseX - px;
	var radians = Math.atan2(a,b);
	var degrees = radians / (Math.PI / 180);
	Cursor.rotation = degrees;
	Mouse.hide();
	Cursor.x = mouseX;
	Cursor.y = mouseY;
	px = mouseX;
	py = mouseY;
}


FLA: http://jpoel.byethost15.com/Swim/Swim_example.fla (you might have to right click on that and click "Save target as"