OK, I've actually had to go through some of this due to my new upgrade. First off, go to the first link and download/install the appropriate AMD driver for your PC (depends on OS, they have many, just make sure to get the 32 bit if XP standard, 64 if XP_64, etc.). Next, if you have CnQ enabled, and you don't have a good reason to have it on, TURN IT OFF! It causes all sorts of fun, and not just with multi-threading.
Unfortunately I haven't found a good tool to check for CnQ within windows, so unfortunately, your best bet is to just go into the bios and disable it (if it isn't already). The Microsoft download is simply a fix for the power management profile, and isn't relevant if you're not using CnQ. Oh and of course, latest and greatest video drivers, as they're still fixing multi-CPU issues with them (both nVidia and ATI).
Now if you're still having issues, you can always set GalCiv2 to run on only 1 CPU, by starting up task manager, right clicking the galciv2 process, and set affinity. Simply uncheck one of the CPU's, and you're set (don't do both or else naughty things can happen
Just as an FYI, I've been running the digital version of GalCiv2 with very few issues, none of which appear to be dual core related. Now the software I'm working on, is another matter, but alas, I stink at writing properly threaded code