Try setting the compatibility mode to XP on the setup file.
That didn't make any difference for me, still get the "not compatible, get a 64 bit one" message whenever I run setup on Windows 7 64bit.
So I poked about in the install folder a bit and found that there's a file called DUKE3D.CFG that contains the mappings for the controls. It's easy to read, says things like:
Look_Left = "Insert" "Kpad0"
So I just edited them in there with notepad (after backing up the file).