Well, before I was unable to see one hostage on the first mission and no hostages on the second mission, but now I am able to see them after uninstalling and messing around with the compatibility settings. I've restarted each mission about twenty times, so it seems to be permanent. I'm running on Windows 7.
-Run this program in compatibility mode for Windows XP (Service Pack 3)
-Disable visual themes is checked
-Disable desktop composition is checked
-Disable display scaling on high DPI settings is checked
-Run this program as an administrator is checked
Thank you! This post should be pinned to all of these topics about invisible hostages.
I had invisible terrorists and the staff member. I was holding off on changing the win conditions or messing with the assets. I disabled this stuff with the Windows 98 compatibility, but it didn't work. Putting it to Win XP with these settings has allowed me to complete the first mission as it was intended. I also decided to run in with 256 colors and it looks more like it should, too.