Desktop Overlay can draw over any game running in windowed (or borderless) graphics mode. Disable any other overlays as well (Discord, FPS Counters, Recorders, Steam, etc.) Rightclick iw4x.exe, click Properties, go to the Compatibility tab and enable compatibility mode for Windows 8.
The crosshair is a special case because it doesnt make anything function differently it doesnt give you any extra information and personally if someone is shooting at me i dont care if their reticle is 4 white lines 4 lines with a purple dot pink dot or someone i know used Jack White. You only need to add a new overlay Custom crosshair in the scene and start a game. You can customize your crosshair in various ways. Right click on the overlay, then select Configure or just double click on the overlay in the list. HudSight draws a crosshair overlay right over a game frame and it doesn't matter what video mode is used in a game. Turn off fullscreen mode by editing /players/iw4xconfig.cfg and changing the line that says set rfullscreen '1' to set rfullscreen '0' and set r. That is why you can switch your game to fullscreen and get minimal input lag.