Game runs fine here on Vista x64, just keep hardware acceleration off.
Cheats wont work here, pausing the game hasn't got any effect either.
This isn't new though, when I first got DK2 (somewhere in 1999) cheats didn't work either. But at a friends place they worked fine (same cd's, game version and I typed them!)
Anyway going to try the save game from level 2 maybe that works.