Simply using the VDM (Virtual DOS Machine) of XP ... windowed or full screen mode ... which is directly called from 16bit application ... when it run ... when you launch it (double click, or via RUN or CMD command line) ...
but ... you must have the files 'autoexec.nt', 'config.nt' and 'command.com' in your SYSTEM directory (usually C:\WINDOWS\SYSTEM32) ... they are normally installed with Windows ... but there is a problem after the installation of SP2 of XP ... look this
h**p://www.oldmp.com/forms/download/xpservicepack2.htm
or this
h**p://support.microsoft.com/default.aspx?scid=kb;en-us;324767&Product=winxp
Pay attention: some 'malewares', if they are hidden (installed) in your PC, they delete 'autoexec.nt' to every startup!!!
m!k27