Hey GUYS! I finally found it out. I tried to get TIE FIGHTER (collectors edition) running for days! I finally got it. I’m a novice so this shouldn't be that hard to understand. TIE FIGHTER will only work by using command prompt, not the way that VDMS works for other games. This way really works(I promise), and I’ve explained in language that anyone can understand.

TIE Fighter is 99.9% perfect under Windows XP. Sound, joystick, everything...THIS INCLUDES MIDI SOUND!

Here's what you need to do:

Download the VDMSound application and VDMSound Launchpad.
Install them.
Fire up a MS-DOS prompt (Start, Programs, Accesories, Command Prompt)
Change to your CD-ROM drive by typing cd x: (where x is your drive letter)
Install TIE Fighter by typing Install then click install when the CD program is running (Full Installation recommended)
Skip sound setup by selecting n for no sound card
Exit install (you will now be in command prompt)
Start VDMS by typing DOSDRV in command prompt.
Now go to your TIECD directory on your C:\ drive by typing CD C:\tiecd\imuse.exe
Use express sound setup when prompted, it should detect a Sound Blaster and work fine, click yes when the music comes on each time. There should be no speed slowdown in the sound. Save the changes each time and you will automatically Exit the install and find yourself back in command prompt.

NOW the part you’ve been waiting for!!!!
start TIE fighter by typing CD C:\tiecd\tie.exe
Configure joystick when prompted
Kick the Rebels all over the place.

To re-run it, open a command prompt
type DOSDRV
and then CD C:\tiecd\tie.exe

This also works for the X-Wing CD-ROM, but X-Wing's memory requirements (EMS) can be annoying. most of the times it works, sometimes it doesn't. Note: If you want to install TIE to a partition other than C:\ you need to move the TIE.CD file that is created on your C:\ drive to the partition you install TIE to.

There are additional patches at LucusArts, but they are not essential for this process to work.