It was a isometric or top down medieval dungeon crawler type game
 

-The game had 4 classes you could play as, one was definitely a Dwarf with a hammer, one I think was a female archer type thing, a knight maybe with a sword, and some sort of wizard guy with fireballs.

-I remember one level had two gears you had to run in between but I would always die so I had my dad do it.

-The main bad guys were demon like creatures, and the game had a lot (I mean a lot) of gore in it.

-The game felt very dark and cramped.

-I played it sometime between 1998-2003 I was very little at the time like 3-5 maybe.

-I probably had Windows 98 but there is a small chance it was Windows XP.

-I think it was 3D but that could be nostalgia.

-It was like Diablo in its game play. Were you click to attack but you move with the arrows.

Seems like clear Diablo-clone for me.

So I can guess Darkstone, Nightstone (variety, huh?), Throne of Darkness, Prince of Qin, Sacred and maybe Akuma.

That is the right track visually, but I don't think it was open world or had an inventory. It just dropped you in to a castle or dungeon thing and told you to go to the exit. It also may have had puzzles in it but I don't remember any.

The description of the classes remind me of Gauntlet. I don't think that is the game, but maybe it is inspired by that game. Does anyone know if there's a list of Gauntlet inspired games somewhere, maybe Mobygames? I tried to find something but my Google-fu is weak. As an example, there is Get Medieval, but I've never played that game I don't know if the controls are as described. The classes are also different, so I would guess it's not exactly the game.

That game looks very close, other than the right side of the screen. So much so I sat up in my seat to get a closer look. I thought it was probably inspired by Gauntlet as well but could find anything.

Based on classes description and lots of gore, I would vote for Gauntlet clone rather than Diablo clone. What was that second old arcade game with similar gameplay? Demon World? But it was more horror than fantasy, with different characters and weapons, so yeah, definitely Gauntlet clone.

Unfortunatelly, I just babble about old titles, I don't know any gauntlet games from this period.

Mageslayer is somewhat inspired by Gauntlet.

OMG! That's it, thank you so much. I can finally play it again.

Yeah, Mageslayer... I remember founding this game on moby and then wanting to play it and review it for abandonia, but not sure what happened... Perhaps I didn't find it or couldn't run it or something.