I have been trying to get this going all week. Got it on steam, not sure if that matters.
Have reinstalled several times, still having issues. Game lags during battles when anybody attacks and after the last install it hangs from time to time just walking around. Changed a few settings and also had a crash.
Here is my APP.log, I'm not sure how to post the crash.dmp or I would. Forgive my ignorance. Any help would be greatly appreciated

INFO: FF7/FF8 OpenGL driver version 0.7.11b
INFO: Auto-detected version: FF7 1.02 US English
INFO: ATI Technologies Inc. AMD Radeon HD 6310 Graphics 4.1.10834 Compatibility Profile Context
INFO: OpenGL 2.0 support detected
INFO: Found swap_control extension
INFO: Max texture size: 16384x16384
INFO: Number of texture units: 8
INFO: Original resolution 640x480, window size 1280x960, output resolution 1280x960, internal resolution 1280x960
INFO: Shader limits: varying 128, vert uniform 16384, frag uniform 16384
INFO: vertex shader compile log:
Vertex shader was successfully compiled to run on hardware.
INFO: fragment shader compile log:
Fragment shader was successfully compiled to run on hardware.
INFO: main program link log:
Vertex shader(s) linked, fragment shader(s) linked.
INFO: FFMpeg movie player plugin loaded
INFO: FFMpeg version SVN-r25886, Copyright (c) 2000-2010 Fabrice Bellard, et al.
INFO: FF7Music helper plugin loaded
INFO: Loading external library Multi.dll
LOCK UNLOCK TEST
MATRIX INITIALIZE
INITIALIZE DD/D3D END
ERROR: could not open file C:\Users\Vick\Documents\My Games\FINAL FANTASY VII\ff7input.cfg
initializing sound...
creating dsound primary buffer
reading audio file
loading static sounds
sound initialized
set music volume: 127
set music volume: 127
Entering MAIN
Exiting MAIN
START OF CREDITS!!!
INFO: C:\Users\Vick\Documents\My Games\FINAL FANTASY VII\movies\eidoslogo.avi; vp8/vorbis 1280x960, 30.000000 FPS, duration: 11.133000, frames: 334
ERROR: couldn't lock sound buffer
INFO: vertex shader compile log:
Vertex shader was successfully compiled to run on hardware.
INFO: fragment shader compile log:
Fragment shader was successfully compiled to run on hardware.
INFO: yuv program link log:
Vertex shader(s) linked, fragment shader(s) linked.
set music volume trans: 127->0, step=60
END OF CREDITS!!!
Entering MAIN
set music volume: 127
Exiting MAIN
START OF MENU SYSTEM!!!
END OF MENU SYSTEM!!!
Entering MAIN
Exiting MAIN
Field Start
INFO: C:\Users\Vick\Documents\My Games\FINAL FANTASY VII\movies\opening.avi; vp8/vorbis 1280x896, 15.000000 FPS, duration: 119.467000, frames: 1792
ERROR: couldn't lock sound buffer
Field Quit
Entering MAIN
Exiting MAIN
Entering FRAME_INITIALIZE SWIRL
Exitting FRAME_INITIALIZE SWIRL
Swirl sound_effect1
stop_sound
End of Swirl sound_effect1
Entering FRAME_QUIT SWIRL
Exitting FRAME_QUIT SWIRL
Entering MAIN
Exiting MAIN
[BATTLE] Entering FRAME_INITIALIZE
[BATTLE] Scene# 300
[BATTLE] Exitting FRAME_INITIALIZE
[BATTLE] Begin main battle loop
[BATTLE] End of current battle
[BATTLE] Begin end battle stuff
stop_sound
[BATTLE] Entering FRAME_QUIT
[BATTLE] endof battle.
[BATTLE] Exitting FRAME_QUIT
Entering MAIN
Exiting MAIN
START OF MENU SYSTEM!!!
END OF MENU SYSTEM!!!
Entering MAIN
Exiting MAIN
Field Start
cross play music: 0
set music volume trans: 127->0, step=4
set music volume: 127
Entering MAIN
Exiting MAIN
START OF MENU SYSTEM!!!
END OF MENU SYSTEM!!!
Entering MAIN
Exiting MAIN
Field Start
Entering MAIN
Exiting MAIN
START OF MENU SYSTEM!!!
END OF MENU SYSTEM!!!
Entering MAIN
Exiting MAIN
Field Start
INFO: C:\Users\Vick\Documents\My Games\FINAL FANTASY VII\movies\mkup.avi; vp8/null 1280x896, 15.000000 FPS, duration: 9.000000, frames: 135
WM_CLOSE
Field Quit
UNINITIALIZE DD
END UNINITIALIZE DD