Damn...ran into the same problem. Did everything 100% correct, but the game is still asking for a CD.
I tried to use the patcher from the downloads section. Says the file is already patched. Still asks for a CD.
Tried moving my CD files to my C: drive just in case Dark Omen finds them there...no luck.
I'm at my wits' end with this :/
EDIT: FIXED IT!
For whatever reason overwriting the ENG_ folder didn't work. you really have to rename it and paste the one from the zip. Weird but true.
Cool, now it works =)