The awesome thing about this Dos version is that you don't actually need Dos-Box to run it. The old windows version doesn't run on XP or dosbox - Ensure that you do not install the Windows version!
Burn the .img to a disk - as an image
Run the installation from the DOS directory (you WILL need dosbox for this step, see that readme for mounting)
Run MERCS.EXE in compatability for win 95 straight out of XP. You will need the cd in the drive to play. You may have to fiddle with the sound settings for the game, but it works fine. The soundtrack runs off the CD even on the largest installation. The music is actually straight cd audio (you can put the game cd in your stereo - track 2 onwards) so it's not going to work when mounted.
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