Random thought for you... I just installed TnC onto my Windows 10 laptop as well, and Windows baulked at me saying that it required "DirectPlay" to be installed before it would work.
Also, if you're running the antivirus program Avast!, it apparently doesn't like playing with DirectPlay (or at least the installer).
To check if you have DirectPlay:
1. Right click Start
2. Click Programs and Features
3. Click Turn Windows features on or off
4. Make sure there is a check in Legacy Components
5. Click the + to expand
6. Check the box for DirectPlay
If possible, try to disable any antivirus programs you have temporarily until this is installed.
Ok, just making sure you didn't have an ISO of a newer version of the game (EX, the Vista version). The newer version of the game won't work.
Would you mind taking a screenshot of that error? I honestly can't tell what type of error it is, so I don't know where to start suggestions... ^^;;
Also... I noticed that your "system.pak" file is 6kb, instead of 3kb...
https://www.dropbox.com/s/fijr5z6dsq...ystem.pak?dl=0 Here's mine. Try downloading it and putting it in your folder. Overwrite the existing one.
It's worth a shot... XP;;;