Well i met the same problem with the Direct3D issues, i searched the forums and read up. And then i tinkered a bit. After updating all the DirectX files (the ones that came with the game AND the one from the web) i opened my NVidia Control Panel, everyone should have one of these, rigth click on your desktop and choose it there from the menu. There you can add King's Bounty to be supported by the 3D anhilliating utillity, add it and press USE. Also allow NVidia to be in charge of 3D rendering in games. After i did this i have now played for 6 hours and NO crashes!
It took awhile and alot of tinkering, kinda anoying cause the game is good, but in all ends it works now. Hope this will help alot of other pips that have similiar problems
Now, on with the game!