Hi, I had exactly the same problem with Fable. I searched for a solution many times, but I couldn’t find anything. I tried these solutions:
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1: Restart your computer by using a clean boot procedure
2: Remove and Reinstall the Game
3: Adjust graphics hardware acceleration
4: Disable AGP Texturing in the DirectX Diagnostic tool
5: Temporarily disable the sound card in Windows
6: Lower sound acceleration
7 : Download and install the most recent version of DirectX
8: Update your video driver
9: Update your sound driver
10: Scan your computer for viruses
11: Remove spyware
12: Install the latest VIA chipset drivers
13: Create a new user account in Windows XP
14: Change the compatibility setting
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But no success with Fable after the 14 steps. Now 3 days later after my deep search I found a solution that works!
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So the solution to a problem is here:
- Deinstall K-Lite Codec Pack!
(If you dont have it, then probably one of the codecs included in it is to blame. Go to k-lite codec pack home page (codecguide.com), look for the list of components and deinstall them on your computer)
- Install some other codec pack if you want (For example XP Codec Pack is [IMG]file:///C:/DOCUME%7E1/Eriksson/LOKALA%7E1/Temp/msohtmlclip1/01/clip_image001.gif[/IMG]. Find it at xpcodecpack.com)
- Deinstall Fable from your computer
- (!) Delete a folder called "Fable" which is located inside your "My Documents\My Games" folder.
- Reinstall Fable into a DIFFERENT folder. For example I had Fable in "C:\Games\Fable - The Lost Chapters" folder, and I made a new installation into "C:\Games\Fable - TLC" folder.
- Play the game and have fun =)
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I deinstalled K-lite Codec Pack on my PC and now Fable works. I am veeeeeeeeeeeeerrrrrrrrrry happy!

I hope you understand my English