nevermind i think i found it....
All Cubase SX 1.05 and older users who need multi midi track recording listen up....
I don't know about the newer versions of SX but with 1.05 and before here is what you need to do..
1. Set up a midi track
2. Open up the "input transformer"(top right button on the midi inspector) not the "transformer" plugin insert because this only acts as a playback filter. The input transformer will actually determine what events will get recorded on the track.
3. Set up a filter- Click "Add line" in the top window pane, this will bring up the filter criteria selection. Set Target-" Channel", Next param-"Unequal", then Param 1 (set the channel you want recorded here)
4. Select module 1 at bottom left corner.
5. Put a check mark in the Activate module 1 box.
6. Make sure "filter" is selected on the pulldown menu at bottom of screen.
This setup will basically filter out streaming midi events whose channel source are not equal to the channel you chose.
Repeat this on every track you need. You can save the first one as a preset and then copy/paste for the next and change the param 1 and preset name. save the new preset for each channel. Make sure the "activate module" is checked for each one because it defaults to unchecked each time. The whole procedure doesn't take very long and it will be available for you quickly when you need it again in the future. Also you could save your whole setup as a template just for this type of application.
Done!
Now you activate the tracks you want to record onto and record.