Creatures Caves

Whenever I try to run creatures 2 on windows 7 I get the following error:
"The error [DDERR_INVALDPERAMS] has been detected when attempting to draw game sprites.
Please check that your desktop is in 16-bit video mode, Microsoft DirectX is correctly installed and that you have the latest driver software for yoru graphics card. Extra information: C : \Programfiles (x86)\Creatures 2\Images\dung.S16"

I have tried compatibility mode and I have also tried using the hexden fix, but neither of them have worked. I installed creatures 2 from my creatures trilogy CD and all the other games from it work fine.

I hope there is another fix for this that doesn't involve getting the GOG version (I don't want to have to pay again for a game I already paid for D: ) or using a virtual operating system.