Hello GOG forum. I hope I can help you with your Dungeon Keeper 2 woes.
Firstly my version is my original CD that I've converted to ISO, moved to a netbook than patched and no-cd added. So I can't be sure this will work. For me though its been working for a year and very few problems.
1: Create a shortcut to DKII.exe. Enter properties add -32biteverything to the end of "Target". My shortcut looks likes this;
"C:\Program Files\Bullfrog\Dungeon Keeper II\DKII.exe" -32biteverything
This clears up all graphical problems for me at the expense of a few fps. But hey, I am using a netbook.
2: In Compatibility tab of the shortcut properties select "Windows XP (Service Pack 3)" and tick the "Disable visual themes" option.
Now try the game. I'm hoping that it will work now. If so yeah. If not...
3: Windows 7 doesn't like DirectDraw. Thankfully someone has created a nifty dll file you can stick in your application folder. Below is a link to the site plus one to a RockPaperShotgun article about it. I think this helps the videos alot. http://sol.gfxile.net/ddhack
With these settings I am running 800x600 with full graphics (including fog on the title screen). I do crash out but its not often. This works for me and again I do have the original version.
Tell me if it works for you.