I've relatively speaking figured it out. The mouse pointer 'sticks' to the ground/surface.
It is really easy to understand by dragging items. You can't really drop something without using the wall or another object to 'lift' the mouse pointer ergo the object.
This applies to attacking. It is far easier to see this in action with the Shield and Sword because the standard attack is very effective (just hold Left Mouse). If you can position the mouse cursor on the Head of the enemy you will swing at that position, then hitting the upper torso, neck, and head.
You still can't 'aim' but you give good enough direction to make critical strikes.