Try running both, the Campaign Manager and RedBaron in compatibility mode for Windows XP or even Windows 95/98 and as Administrator (Right-click both and select Properties => Compatibility tab; Set the mode and tick "Run this program as an administrator")

I don't think its that easy - its a known compatibility problem. I'll try it but I think others have already done so.
http://www.gog.com/forum/red_baron_pack/cm11_64_bit

EDIT - been a while so memory was foggy - 64 bit is the problem.

Ah yes, you're right. I didn't know you're using a 64 bit version of Windows. It would work on Windows 7 32 bit but not on 64 bit. Actually there's no other solution than using virtualization, as 64 bit Windows can't run 16 bit applications natively.
If you're using Windows 7 Professional, Enterprise or Ultimate you could set up its XP Mode or install a 32 bit Windows on any virtual machine like VMware or VirtualBox. I have to admit that it's some work to do, but unfortunately the only way.