...don't try to install the 1.3a patch until the game runs as 1.2.I don't know offhand what the Lithtech problem is. Something about your system or setup is confounding the program. The most common way to create a setup problem is to install the game, then uninstall it improperly (not necessarily by doing anything wrong), and then re-installing it to a different location. But this is probably not the case.
The most likely culprit is either a bad driver or a bad DirectX setting. Make sure you're running the latest release of whatever version of DX you have -- 9.0c or 8.1. Make sure your drivers are compatible with your version of DX. Tell us your hardware configuration.