You don not need to create a $(document).mousemove( function(e) {})
to handle mouse x,y. Get the event in the $.hover
function and from there it is possible to get x and y positions of the mouse. See the code below:
$('foo').hover(function(e){
var pos = [e.pageX-150,e.pageY];
$('foo1').dialog( "option", "position", pos );
$('foo1').dialog('open');
},function(){
$('foo1').dialog('close');
});