I have spent six years looking for this game and now that I have it....I cannot play it(bloody Murphy's Law!). The game will boot to the main menu like it should but when I choose to play a new game and it crashes to the Windows desktop. Just the other day I got the 445 patch but it continues follow the same routine.
My system specs are as follows:
Celeron D LGA775 3.06GHZ
2GB OCZ ValueRam
ASUS P5GLMX
Chaintech GeForce 6600 256MB DDR/DDR2(not sure which)
Maxtor DiamondMax 10 300GB SATA-150
Plextor PX-716SA
Creative Sound Blaster Audigy 2ZS
Ultra 500W X-Connect PS
Aerocool Jetmaster Jr-BS
WinXP PRO without SP1 or SP2(havent installed them yet)

If you can help me please let me know what might be wrong.

Well it crashes just like soooo many Win 95/98 games. Have you tried to set compatibility mode? It sometimes helps but not often. Sometimes an XP patch comes out for these classic games (like Heroes III and System Shock 2) so you could look for such. But really your best bet is to install one of the 9x windows and use boot manager to switch your OS to 9x when you want to play. Sorry but the libraries used by 9x are very different than the 2k-s.

Hi Just installed Drakan and have XP Pro SP2 and all patches. Have a crappy Toshiba Satellite laptop 1100 Celeron with a crappy Trident Cyberblade inbuilt Video and 384 mb SD Ram. Have had no crashes, lockups etc, just isn't very fast (jerky play) but the laptop is rock solid and never crashes. I once had a Athlon 1200 which I loved and when I put a new card in to upgrade the inbuilt SIS 630 video it went haywire and locked up, crashed and generally gave me heaps of grief. Went back to the inbuilt chipset and it went smooth as silk. Have you tried to borrow a mate's video card to see if it might work better with that? Some chipsets just aren't compatible with some games. Try a different driver, this might help. Honestly Drakan's engine is so low tech you should be able to run it on a Pent 166 with 32mb RAM!! Best of luck.