This game is a bit hard to get running on a new computer, but there are ways...
First go to
http://shortfilms.tk/ and download the Legacy Of Kain XP Update.
Then you will need a slowdown util that slows down your computer to a maximum of 1200Mhz. There are some that are recommended, but the util "Turbo" (available everywhere) worked very good for me.
This is AFAIK the only way to get the game running on a modern WinXP computer.
EDIT: I can't get this game to work anymore since I upgraded (just tried), so I fear that maybe AMD C&Q is giving me problems... sorry mate.