Hi. I had the same problem- the mainsystem error thing. and i tried numerous ways to try and fix it but none worked. In the end (just when I was bout to cry in frustration) I decided to try a different approach.
What ended up sort of working for me was to just install the game in original jap (w/o installing the 1.2 patch and eng patch). Then I played the game till adonis first appears and saved the game (all in jap first). After doing that i then installed the 1.2 patch and eng patch. After u have installed those u when u next play the game just load the previously saved game and it should work fine frm then on (it'll be in eng and all and best of all no more main.system error thing).
It worked for me so i hope it works for you too. Good Luck!
how to save the game in japanese?
On x64 Win7, this still doesn't work. When I first played this game patched several years back, I had to create a separate windows xp partition JUST for silver chaos, but my hard drive died a few months ago and I could not be bothered to recreate the partition, plus I'm no longer eligible for student licenses of WinXP.
Turns out straight up removing OPEN.AVI from /My Documents/VividColor/Silver Chaos/ takes care of the problem. You don't get to see the opening cinematic, but trust me, you're not missing anything.