CHeck the Daphne log file. It will tell you the area it is looking for the frame file. I moved my LAIR directory from D: to C: and it sopped working. Turned out my config was pointing to D:...
Barring that, post your log file (sort by date descending to get the lof file...
mm im struggling here not sure how i move the LAIR directory?? and ill bet its simple, anyway ive posted the log file below.
--DAPHNE version 0.99.7cvs
--Command line is: C:\Documents and Settings\graeme\Desktop\daphne\EMULATORS\DAPHNE\Daphne MPEG Loader 1.2\Daphne MPEG Loader v1.2 - for Dragon's Lair II - Final UPDATE\daphne.exe lair vldp -framefile C:\Documents and Settings\graeme\Desktop\daphne\LASERDISKS\DRAGON'S LAIR\Framefile.txt -useoverlaysb 2 -bank 0 10011001 -bank 1 01100011 -x 1152 -y 864 -sound_buffer 8192 -noserversend
--CPU : GenuineIntel 2400 MHz || Mem : 768 megs
--OS : Windows XP/.NET || Video : NVIDIA GeForce FX 5500
LDV1000 : Instantaneous seeking enabled!
Setting screen width to 1152
Setting screen height to 864
Setting sound buffer size to 8192
WARNING : You have specified an abnormal screen resolution! Normal screen resolutions are:
640 x 480
800 x 600
1024 x 768
1280 x 960
1280 x 1024
1600 x 1200
Set 1152x864 at 32 bpp with flags: 0
Initializing sound system ...
No joysticks detected
Reading key remapping file ... (if the file is corrupt, daphne will crash, just so you know hehe)
Loading roms/lair/dl_f2_u1.bin ... 8192 bytes read into memory
Loading roms/lair/dl_f2_u2.bin ... 8192 bytes read into memory
Loading roms/lair/dl_f2_u3.bin ... 8192 bytes read into memory
Loading roms/lair/dl_f2_u4.bin ... 8192 bytes read into memory
Could not open mpeg frame conversion file : C:\Documents and Settings\graeme\Desktop\daphne\LASERDISKS\DRAGON'S LAIR\Framefi
Could not open frame file!
You must specify a -framefile argument when using VLDP.
If you didn't, then this is the problem.

Could not initialize laserdisc player!
Shutting down sound system...
Shutting down video display...