I prefectly understand yoru frustrations Hemi as I have been following your long treck to get the game ever since you originally started looking for it.
Your problem seems to be connected to your pc though not to the installtion Cd since it works well on your friend's pc. There's something missing and since you have Direct X9 C installed and all your drivers updated I really wonder
I have the game installed on a laptop and a pc with 2 different OS Win 7 64 bits and Vista 32 and absolutely no issues. I also have 2 different anti viruses AVG and Panda thus we can eliminate these causes as well.
Have you looked into your BIN folder? Take a look and see if you have a shell file.My suspîcion is that a file is missing either one of the codelib ones(base_main or base_install or base_gener) of perhaps the shell starter .You should also have in the same BIN folder the following:
d3dx9_31,35,36,37,38 and 39 and msvcm80, msvcp80, msvcr80. All these files are eseential for the game to start or work properly.
One way or the other we are goign to solve your problem. don't quit!
Cheers