Hey, glad you managed to get it running!
1. The music's probably in CD-Audio format on the original PC release and I'm guessing GOG is running it through some other means (.ogg or .mp3 files maybe?). I can see a "MUSIC" folder in there, but I have no idea how it plays it.
2. Looks to be running at low-res and interlaced, I'm sure there's an option to at least get rid of interlaced, and I'm fairly certain you can run the game at 640x480 as well. If you can't find them inside the game, perhaps they're tucked in the "setup.exe". Unfortunately, there's no D3D or oGL patch, there's only the 3Dfx version for accelerated 3D, "Pandy3.exe".
I just took a look at one of your other threads with a Tualatin + GF2 Ultra build, is that the system you're running the game on? Pretty sweet build you got there! You may be able to run the 3Dfx version of the game without a 3Dfx card, by using a Glide wrapper, a program that essentially intercepts all the calls that the Glide API makes to the system and translates them to another API that your system can use. This is a very rough approximation of what it does (please don't whack me in head more knowledgeable people!), so it will allow you to play the game using that version (it's pretty much what GOG's doing). Unfortunately, as other people noted, nGlide uses DirectX 9, specifically D3D 9.0 to pull this off, and the other more advanced wrapper, dgVoodoo2, uses D3D 11.0, so both are no go with your current hardware.
Instead, you may try the original dgVoodoo, which hasn't been updated since 2007 and uses DX 7 and/or DX 9. I've had success in the past using this, perhaps it will work fine in your case as well! There were some other wrappers before this, but from my limited testing many many years ago, they seemed inferior and probably aren't worth the hassle nowadays.
In any case, software mode might look just as good as 3Dfx when run at high res, a lot of games at the time used 3D cards for offloading the CPU and running at high res + bilinear filtering (which looks pretty bad to my eyes now) and usually didn't apply any new effects (perhaps some transparencies, sometimes) compared to the software renderer (sometimes they even removed features 😉 ). Pandemonium, being a PS1 original game, might actually look a lot better without any texture filtering and run at 640x480 than it does with Glide. Again, I haven't played it in ages (I should!) and haven't seen them side by side in many years as well.
Funnily enough, the sequel, which I happen to own in its big box release but have never played unfortunately, actually demanded a 3Dfx card and did not feature a software renderer or any other 3D API support! One of the few games that I know of that did this, along with Gex 2 and perhaps one more title that eludes me at this moment.