First off, thank you all for your help. And thanks to threesixty for the wonderful history lesson. I always appreciate that sort of thing (It's the kind of thing I'd do in a post).
I think I have things under control, finally! No more corruption. No more crashing (so far, so good). There was one background which would cause a crash 100% of the time and I tried going there (the bar in Kalm) and NO CRASHES!!!! WOO-HOO!!!
Now for the issues...
Just to clarify, you've tried *every* software mode? And are backgrounds the only ones that get corrupted, or do other textures as well? I guess I'm interested in quarterscreen in particular, because that uses a partially different texture set.
Yep, every software mode still caused problems. Only certain backgrounds were affected and only non-battle ones. Tifa's Bar, Sector 5 Slum near the Church, Outside Aeris' House, Wall Market North near Gun Store, Roof of Shinra Building, Midgar Mayor's Office (Shinra 63rd Floor?), J-E-N-O-V-A Lab (Shinra 65th floor?), Detention Area near the Lab, and a few others that I forget. All battle and character textures were unaffected. Most of the time, quarter screen mode would fail to work entirely, causing a crash during startup. In fact, this happened often in any mode, during the EIDOS video, which is partly why I figured that it had nothing to do with DirectX, or my drivers, or my TNT card. It turns out that iccvid.dll is a file that has to do with audio/video playback codecs, so now it all makes a little more sense.
do a partial install,
and
I'm assuming he/she has a non-pirated copy. If not, that could pose a problem..
and
partial install is just as important because that will leave flevel.lgp off your hard drive entirely (it'll access the copy on your game discs.) Yeah, it makes scene loadtimes a lot worse (even on fast machines), but it might just do the trick ending your cross-linking problem.
I have a 100% legit, purchased-right-about-when-it-came-out copy. I remember having a B*tch of a time getting it to work back then (on Intel hardware even). I had considered a partial install to combat the corruption problems. Alternately, since I doubt that file needs to be written to, I could append the file properties of flevel.lgp as "Read Only" in Windows and see if that helps, should it happen again (gawd forbid).
Anyway, here's what was wrong and how I solved it:
1) booted up in DOS mode (F8 at startup, select "command prompt only") and run scandisk. Scandisk found three cross-linked files; flevel.lgp (122MB), iccvid.dll (108KB originally), and Windows Hell Desktop Theme.zip (1.8MB originally).
2) Had scandisk repair all files in question. The files were cross-linked 48 times in 63 chains. "Fixing" it took several hours. Good thing I was going to bed so I could leave it on overnight.
3) Booted back into Windows in the morning to backup the "repaired" files. The iccvid.dll and the zip file were many times their original size. Extracted into a temporary folder the original iccvid.dll from the Win98SE CD image on my other system's hard drive.
4) Deleted the corrupted files.
5) Copied the fresh version of iccvid.dll to where it was stored before (C:\WIN98SE\SYSTEM).
6) Backed up FFVII savegames, and patched versions of FF7.exe and FF7Config.exe.
7) Uninstalled the game. Deleted all the folders and registry keys.
8) Ran Defrag on the drive. Good thing it was time for work - defragging takes forever on this old beast.
9) Reinstalled the game and restored the backup saves and executable files.
10) Rebooted into DOS mode as in step 1, then ran scandisk AGAIN. Repaired the new damage (file fragments; Residual damage from the problem and the solution).
11) Loaded Windows, then loaded FF7 to test out my "fix". Everything worked fine. All conditions that were previously 100% sure to cause a crash went without a hitch. Graphical corruption in locations (Tifa's Bar, Aeris' House, Wall Market, Roof of Shinra Tower, Sector 5 Slums near Church) is gone.
12) Rejoiced and did a little happy dance.
I don't know what caused it (not spyware; I use AdAware) but whatever it is I am going to monitor my hard drive very closely and let you all know what comes up. Direct X seemed to have nothing to do with it, and neither did the drivers. I have a feeling it could have been my virus scanner (Trend Micro PC-cillin 2000), which I removed (not really needed on my Legacy Box, since I browse the internet and receive all email on my primary system).
Once again I'd like to thank Threesixty, Rubicant, Srethron, and halohalo, for all your help! Let me know if there's anything I can do to help you in return. I'll do whatever I can (filehosting? troubleshooting?).