Check the quality of the disc. I keep an ISO of mine. The only other thing that stand out is you mounted it as E:\. I just tested with mine and it didn't cause a problem.

The disc seems to be in perfect condition. Also, I tried mounting e as d, but had the same results.

If I made the CD into an ISO file and tried to run that, could that solve the problem?

[Moved to DOSBox Games/Apps. Section]

There's another topic like this. Maybe the DarkSeed discs are prone to warping with age.
Anyway, if the problem is with the disc any read errors caused by that would be copied to the ISO.
It's worth a try but a good copy requires a good original.

Don't know the game, but before resorting to drastic measures like buying another copy of the game you should delete everything and reinstall with a mounted C: and your CD-ROM (or image) being D:\, i.e. no "gaps" in drive letters. Also, make sure you have write/create/append permissions on the directory you're installing to. I probably don't have to point this out, but "c:/darkseed/binmod.exe" isn't a directory, so I guess the error message could be misleading.

P.S.:

Anyway, if the problem is with the disc any read errors caused by that would be copied to the ISO.
It's worth a try but a good copy requires a good original.

Huh? You do realize that CD-ROM's have error recovery data stored on the media? Every decent imaging program will notice if a copy is not OK and ask the user for an appropriate action (retry, abort, etc.). A "good copy" doesn't "require a good original", it requires an original disc that can be read at all, no matter if that's with difficulties. Here's some info on the data format used on CD.

P.P.S.: just noticed the "Also, I tried mounting e as d, but had the same results." bit, didn't see it when I wrote my initial answer. Well, just try using an image, can't hurt. If you're still having troubles we need more info: OS, DOSBox version, etc. .

YES!

Okay, thanks for the suggestions, you guys. After many failed attempts and quite a long time of looking up stuff on the internet, I decided to just try and install the game on drive D instead of C. Seems like a simple change, but it worked completely. Not only did the game install, my saves work now (which they weren't before), and the game doesn't crash once I pick up that freakin' package! Finally...

Just in case anyone else looking at this is having the same problems, here's what I did.

mount d d:\games
mount e e:\ -t cdrom
e:\
install
-game installed successfully on drive D-
DS
-GAME RUNS-

It's pretty simple really, I just changed it to drive D and it worked. Thanks again for the suggestions.

That's weird but glad to hear it worked for you.

there is nothing weird. you cannot make gaps between c and e