Direct Sound Accelertion
Dxdiag Instructions....
In the "Run..." menu of Windows. (It's in the Start Button....)
Type: Dxdiag
In the text box...and press OK.
A program will load up.... Go to the Sound Tab.... there will be a slider bar.... move it until you see it say something about Basic mode. Should be the second notch from the left. I had a problem with FF7pc on my PC, and putting it on basic mode worked for me.
As for codecs and all that jazz.... I don't know anything about that stuff. I know what they are... But I don't know how you can remove them from WinXP. Honestly....I don't think there is any simple way of doing it. Win98 I know of a way....but not WinXP. But, if the movies play in window's mediaplayer.... then most likely they'll play in the game, too. They may not play very well... Could be a slideshow in-game.... But, I would gamble to guess that the Video Codecs are not the cause of a Drop to Desktop, in such a case.
Note about the TNT patch: The TNT patch isn't a Nividia patch...not really. What it really is, is a 8bit pallet disable patch. The TNT patch only works with video cards that FAIL the 8 bit pallet test. If the 8 bit pallet test says PASS, the TNT patch will not work. So...if your TEST screen in the FF7config program says PASS for that test.... then the TNT patch isn't going to work for you. I'm not familar with ATI... but it's the same for those cards, too. Also, beaware, this is only for Hardwaremode... Doesn't matter with Software mode. So, get the game working in Software mode before messing with Hardware mode. Or you'll just compound your errors and will never find the cause.
Also be aware, it's not really the video cards that control whether the test reads Pass or Fail, it's the video drivers. So it could be that updated video drivers, will fix it, too. (again this is for Hardware mode.....get Software mode working first.)