tried it, still same error

Try removing wsock32.dll and/or winmm.dll..?

Hm this isn't the first time winmm.dll was the cause of the problem on win xp, but this is usually for ingame music supposed to played on the cd from the HDD.
I had the same problem with it in cultures 1 couldn't run the game until removing winmm.dll
The game works now but is without music, couldn't even make the music run when i played the cd version or i didn't have the cd inside?
Had no problems with it on cultures 1 when i used windows 10,but i could play the game on xp with a special winmm.dll but it didn't play any other songs than the one you choosed until finished.

Edit: using that winmm.dll from tie vs x-wing forum for windows 10 seems to make the music work but if it works correctly i am not sure.

Put CD in first CD/DVD drive. Virtual drives count! (You can change drive letters).