CaptainAppleMan: I can move north-east, so no.
grviper: Does the keyboard in general have trouble with 3 buttons pressed at the same time?
CaptainAppleMan: This still an issue for you? I've been playing Blake Stone for the first time today and had a play around with my DOSBox (I'm using 0.74 instead of 0.72 which comes with the GOG installer). If you've used the DOSBox key mapper then you may have broken some control button. Try using the Reset KeyMapper or deleting the mapper text file if you have one.
On that note, I've actually used the Key Mapper to add the strafe modifier to my left and right cursor keys so that they strafe left and right instead of turn. I can turn with the mouse still, though I cannot circle strafe as using the cursors turns on the strafe modifier so the mouse would then strafe too, but it is a nice improvement for me. I also use novert to remove the mouse Y-axis to prevent the mouse from moving me forwards and backwards. See this thread:
http://www.gog.com/en/forum/blake_stone_series/mouse_config_q