Nox
It is one of my favorite games. It is westwood response to Diablo. It is an old game from around 99 but still so much fun.
Three characters to choose from:
warrior: fast, durable, strong, can use the heaviest of armour and strongest weapons but cannot use magic at all and have only few not very effective long range weapons.
Conjurer: average stats, primary weapon bows and crossbows, limited magic capabilities but can control creatures and even summon them.
Wizard: lowest stats of all sans magic. Can use only wizard robes and staffs. Has access to most powerful spells ever as well as magic staffs.
You take control over Jack, a average guy living with his girlfriend in a trailer park.
One day a powerful necromancess from the land of Nox opened a portal to our world summoning an egg shaped magic crystal containing necromancers souls. That crystal was banished to our world after the great necromancer war which devastated the land of Nox some time ago. Said necromancess wants to rule the world so it is up to Jack, the player, to stop her as he is the only one who can move undetected as he is not from Nox.
Game is fun. Completely three different styles of playing, with quite different storylines as well as endings. Lots of weapons, different enemies and many various spells, interesting characters, living world.
The game is simply fun.
Few screenshots:

Well, although it's in 3D, from the GOG catalogue you could check the newly-added Empire Earth Gold. Given it's from 2001, it is really not heavy on your hardware, and it is quite fun to play. Unless you play in tournament mode, it has quite a low pace, but it is its intention (and you can always select "tournament mode" to speed things up). The AI is surprisingly good; I'd say it can compete with that of StarCraft.
(Sorry, I can't give any recommendations regarding a good hack'n'slash besides Sacred.)

My vote is for Nox also, but sadly, you won't find it in GOG's catalog. It's pretty diablo like. Depending on which character class you pick, you start out at a different place and get a different starting quest, until you're smoothed in into the main quest, and even there, some missions are similar but different in gameplay. For example, warriors and wizards don't get along. Play as a warrior and eventually you'll get a mission where you must storm a wizard fortress. Play as a wizard, and you'll have to sneak into the warrior's fortress using several of your spells.
Combat is pretty cool and so are some of the spells. I highly recommend it.
The only other diablo like game in GOG's catalog aside from Sacred seems to be Lionheart, legacy of the crusader, but the reviews aren't that reassuring and I've never played it.

not in the gog catalogue but there is also silverfall/silverfall earth awakening and loki in the hack&slash genre.
loki being the better of the two. neither are abysmal but they arent titan quest quality either.
both fully 3d though.
not many hack&slash apart from sacred on gogs list. youll have to look outside of gog.

Let's see..
Divine Divinity, I'm sorry to say was awkward crap. It might have been a good game, but I had constant crash issues, and the game play was horrible compared to any decent hack and slash title.
SilverFall/SilverFall Earth's Awakening, mediocre in all respects. I did like the nature vs. tech thing it had going. Poorly balanced though. Tech was superior.
Fate, a pretty low grade one, with a few fun features.
Eye of the Dragon made Divine Divinity seem like pure win.
Nox, was a good one, if you can find it. :)
Throne of Darkness, mediocre really. Had positives and negatives, I think all it REALLY had going for it was the whole 4 person party thing.
Mornings Wrath (indy title), has a crap control scheme that renders it neigh unplayable.
I know you mention Sacred, but Sacred 2 earns a mention: Comparing Sacred 1 to 2, is like comparing Diablo 1 to 2. There's some really awesome new features in Sacred 2, but it feels a bit likes it's missing something. Still a good game though. Although one noteworthy thing, Sacred 2 does not take itself seriously at all.
There are more titles out there. You of course have already mentioned my favorite ones (Diablo, Sacred and TQ), these are just the ones that I've played that come to mind right now.

Problem with loki is it will need a good system to run it and even for a hack and slash game it gets repetative. The level designers just seem to have added 2/3 of the levels into the game just to make it longer. It has an excellent crafting system though, would be nice to see something like it in a future hack and slash.

these probably won't work on the compuer he's describing

The only one I had a great time with was Divine Divinity. Everything else, including Sacred 1, 2 and TQ, had a severe lack of dungeons. Way too much open field.

i get sick of dungeons, i loved tq:it's awesome egyptian and mediterranean environments. they were sprawling and beautiful and made me want to explore, unlike the dark, boring, repetitve dungeons in so many hack n slash games.
still, to each his own, i suppose some people appreciate the structure and order of dungeons.

Well, I feel this like Titan Quest is only Open-Air dungeon. But I agree, that locations in Titan Quest are beautiful.

The kung-fu hack'n'slash you are referring to ....would that be Seal of Evil?

Close! Really good guess. I just checked my shelf - it was Blade & Sword. Cool fighting system. Otherwise, very mediocre.
Oh, and I just checked my shelf. I was in err, it's Throne of Darkness, not Throne of Blood.

Go hardcore - get Daggerfall.

My guess is that by Diablo-like he meant action RPG, and some titles given do not have much action. Else if we go with the general "dungeon crawler" direction, there are quite a few more titles to be given.