I found out that if you drag a lot of folders/files in the composer it will automatically come up with a checkbox to enable long context.
Not sure if it would ever automatically do it in the background though.
Hey, by having it on in the settings, Cursor will opt to use the longer context option when available, but I believe this does cause higher usage of requests than in normal context mode.
The popup shown here only shows up if we think your prompt could benefit from the longer context, and you don’t yet have it enabled!