1. There is a bigger pool of players for Classic. Once you move to the niche games, it is harder to find an opponent.

2. The 3rd edition rules allow submarines to submerge and battleships can have 2 hits. Very good for the Japs!

1. Try disabling hardware acceleration. From memory, right click the desktop and proceed from there.

and/or

2. Click Start (the Windows icon in Windows 7) and then right mouse click on the A&A icon.
Go to Properties, then Compatibility. Set the OS.

3. Also, you can now play without the CD. Find AAStarterPack51 on one of the boards. Not bad. It is a very good hack.