This is really the best advice on the thread. Not only do you get the option of fully 3d rendered Duke, but it removes all the headaches of trying to get the controls and mouse set right.
Your best bet is using a modern port of the game, such as the EDuke32
, which has a completely new OpenGL renderer; with the new renderer the mouse-aiming is smooth and works as if in any modern game.
If you want to use the DOS version, I think there are options for setting the vertical mouse speed, but it will still feel a bit of, since Duke's aiming always was a hack done with the renderer, which is why newly written renderers work better.