This error seems to be caused by an update to Windows 8.1 (maybe 8.1 Update 1?). Has something to do with altered permissions on one of the direct play dlls. I can't really remember because I hit this snag about a month ago. After tinkering for a few hours, I realized the easiest way for me was just to reinstall Windows 8.1 and turn off Windows Update, which worked. You can also try doing a system restore to before the update, but I'm not 100% sure that's the root cause.
Also, I noticed that the issue is with Fighter Maker games in general (Toffisama's Fairy Wars, Princess of the Ring, Fairy Fighting, and I think Eluku's new Wolf Dungeon), so might as well revert back if any of those games are remotely interesting to you.
Note:
If you really want to try to fix it on your current version of Windows, here's a link I found helpful (sorry my noob status prevents hyperlinks, just copy-paste it):
bvsystems.be/error0xc0000022.php
I still had errors after going through those steps, so if someone finds out a complete fix please let us all know!