RocksinBoxes: I agree. There might have been some misinformation floating around online on whether the game worked or not.
dreadcog: The Z.cfg should look something like this with a little editing in the Dagger folder. I did this a while back because I was having trouble with the CD not being recognized. I heard editing the Z.cfg works without any cracks but I patched it and cracked it just to be safe. The only downside if you want to call it that is your friends have to copy the movies to the HD if they want the movies.
type dfall_huge
path c:\dagger\arena2\
pathcd c:\dagger\arena2\
fadecolor 0
mapfile d
rendergame 1
user 1
startMap 179
region 17
helmet 0
maxSpeed 200
controls betaplyr.dat
maps mapsave.sav
cheatmode 0
If you need any files let me know I'd be happy to e-mail them.
What's here should help. Thanks a lot.