First of all, try running msconfig, and using it to turn off all your programs that run automatically at startup...some of them show up in the taskbar, others are running in the background without giving you any visible clues that they are.
To run it, go to the start menu, and choose "run..."
Type in "msconfig" (without the quotes, of course) and hit enter.
When the program comes up, click the "startup" tab. You'll see a lot of check boxes for different programs that run at startup. Uncheck all of them. Restart your computer.
Run ZC.
If it works...
you know that it was one of the startup programs that did it. Start up the programs that run at startup one by one, checking each time whether ZC still runs right. When it stops, you know you've found the program (or one of the programs) that cause the problem...just leave that one turned off in msconfig, and you should be fine.
If it doesn't work...
It's not over yet...there are a number of programs that automatically re-set themselves to run at startup if you turn them off with msconfig. Run msconfig again, and see if anything is checked on the startup tab. If so, it means you have some poorly programed or some dangerous software on your computer. Either way, it's best to un-install the offending software, since both kinds are bad for your computer.
I know Banjo Buddy fought tooth and nail to keep from being disabled at startup (Was that the name? The stupid surfing purple ape that made wisecracks at you...my step-brother installed it on his computer). I'm not sure whether it fought being turned off because it was spyware, or just poorly programmed, but...since it used sound...something like that might take control of your sound card and not give it back.
Try again once you've gotten rid of any offending software and restarted your computer...if you've checked that nothing is set to run at startup, and you're still having problems, it's not a conflict with other programs, it's an issue between ZC, Windows, and your hardware.
As far as checking compatability for your soundcard...get ahold of a copy of AGsetup (by downloading ZC 1.90 if you don't have it)--running that will let you know what kinds of sound support your computer has that are supported by ZC, and let you change them, if the problem has anything to do with the default choices that ZC made when it generated ag.cfg.
When you run it, click on the midi driver button (since it seems midi's the problem). Everything with a ^ next to it is available on your system. As mentioned before, MPU-401 is the best, if it isn't available, or doesn't seem to be working for you, pick something else from the list. Some midis will get quite garbled by the less capable settings, but I think there's one or two other settings that can handle high-quality midi...try a few, if MPU-401 won't work, until you find one that does.