[dosraider]

Your mount lines are correct it seems.
Renaming the ISO doesn't affect the setup nor the running of the game (Tried it myself after reading your post).

What you could try: delete what you've done till now, eventually redownload the game (luckily it's a small one), maybe the download was corrupted?
Or it's your unzipper? I use 7zip.....

BTW, "SB live ? There is no SB live in the choices menu....., simply choose SOUNDBLASTER, works fine here.
If you meant your real hardware soundcard, nothing to see with what's emulated in dosbox.

Next thing that I tried to avoid that install problem:
Create a folder \ecstatic\ in your oldgames folder and copy EVERYTHING from the CD (or ISO if you can open that...) into the ecstatic folder, be sure to keep the subfolder structure intact.
Next run dosbox, mount the ISO as D: and run setup from it, choose again c:\ecstatic\ as install folder, and soundblaster, simply overwriting the files/folders in \ecstatic\
Works also.
Must mount the ISO to run the game.....