I followed the directions for installation, having copied the CD to my hard drive, and I got the vide error with the 0bits nonsense.
I switched my display settings to 16-bit color rather than 32 on my video card NVidia GeForce 6150, and now the game's working just fine.
Essentially, I went directly to the application accessing my video card to change from 32 to 16 bit color, but I guess if you just right click on your desktop, select properties, and go to appearance or display (whichever one gets you to the menu with the monitor and screen size settings) and switch to 16 bit color there, it might also work.
I did not have to change screen size.