For anyone interested I found a script snippet that works to select the item under the mouse even if the mouse if hovering over the fade area.
It's worth noting that if the item (on the left) adjacent to the crossfade is already selected this also needs an "unselect all items" command first to prevent both from becoming selected
Code:
_, _, _ = reaper.BR_GetMouseCursorContext()
item = reaper.BR_GetMouseCursorContext_Item()
if item ~= nil then
reaper.SetMediaItemSelected(item,1)
reaper.UpdateArrange()
end