that's seemed the bug converting black into transparent , which doesn't work with intel integrated GPU card drivers , since 2016 about.
So you may try :
1. select "directX version" to 7, in the option limit ddraw interface, select it and be sure is on 7.
and/or
2. select Trim texture formats.
and/or
3. change the render in SDL one or hybrid or GDI.
and / or
3. Discard dxWnd and try dgvoodoo 2.52 version. It will be more compatibility and works well, but worse performance.