Hello,
This next step should fix the issue. Now that you have the latest version of DirectX installed, you need to manually install that .dll. Some old DirectX .dlls have been discontinued (in particular in Vista) and so old games requiring them will crash. However, if you manually add them, the games usually start to work.
Download d3drm.dll from here:
d3drm.dll download - free dll files
and put it into your C:\Windows\SysWOW64 folder and run the game. If that does not work because of the same error, put it into the C:\Windows\System32 directory and the game directory. These last two folders are not usually required.
If you get a different error asking for a different .dll, use the site above to find and download it. Then put it in those folders I have mentioned above. If you get a different error which you cannot solve, just ask me.
If you are worried about the safety of this procedure, then don't worry. This is a common and safe procedure that we carry out all the time. I have personally put in that exact d3drm.dll from that exact website to make a game work. I put it in and that game worked instantly. It is very rare for more than one .dll to need to be implanted for one game, but the highest I have ever seen is three. After doing a few of these games, you end up building a little collection of these discontinued .dlls in your System32/SysWOW64 directory, and games that would have problems suddenly don't!
Good luck and this should be the fixing move,
Richard