I don't know what machine he is running this on but if it is a machine with Hyper Threading I have heard that some people have had to go into the system BIOS and temporarily disable HT or Hyper Threading.
The 1.01 patch and Windows XP compatibility mode took care of everything for me. I run GF in Win 98 mode, I disable visual themes and turn off Fast Indexing. Of course you have to run the patch before you make any save games.
For me at least, I found that when I first ran into a crash that if I ran the patch but tried to use my old save game files that it would still crash. If I uninstalled Grim Fandango, deleted all my save files, re-installed Grim Fandango, then ran the patch before playing the game it would fix the issue.
I also hear that some people have had to uninstall DirectX from thier systems and then reinstall DirectX 6 on the Grim Fandango CD. Personally I doubt that it was the version of DirectX but rather a bad install of DirectX. Uninstalling and reinstalling simply fixes the bad install would be my guess.
Another solution for some errors is to run MoSlo and downgrade the speed of your system. I haven't had to do this and I have a 2.8GHz P4 but I might just have a better BIOS or a more compatible chipset design. Or maybe I took a different path through the game. Who knows.
Again, for me personally I found the using the patch with a fresh install and setting up for compatability mode got it all working on my 2.8 P4 with 1GB ram, a Radeon 9800 Pro, and Audigy 2 running WindowsXP Pro. Oh, I did copy the files off the CD onto the HD but I don't think that did much other than to speed up and smooth out access to cutscenes.
There are other resources out there for the Lucas Arts adventure games. You may want to look through some of those too.
Try these...
Mojo's Grim Fandango Network (
http://www.grimfandango.net/)
Number Nine Grim Fandango Fan Site (
http://members.tripod.com/~Swo_1/The_Number_Nine.htm)
You should find what you need at one of those. Also check out the Mojo site for a celebration of all the Lucas Arts classic games.
The International House of MOJO (great collection of fan sites for the Lucas Arts games) (
http://www.mixnmojo.com/)
Hope some of this info is of help to you.
EB