DustyStyx: You might also try one of the SVN builds of DOSBox. GoG releases Blood with an older version of DOSBox that has some known issues. The SVN builds compile with newer code that has addressed some of these.
http://www.dosbox.com/wiki/SVN_Builds I'd recommend the ykhwong build. If you need help, let me know, but basically, just grab the windows .7zip archive and replace the contents of the DOSBox folder in your Blood directory with that from the zip file.
DustFalcon, just asking, if the sliders in Blood itself doesn't work but presumably, you've had success in a similar situation that was addressed with Skulldog's launcher, what is Skulldog's launcher doing differently? Is it tweaking the settings in the Blood.cfg? If that's the case, simply editing the FXVolume, and the MusicVolume values might address the issue without needing a separate download. Some times these things go missing from the Internet.
Have a look at the pic attached below. The one w/ the red rectangle is the cd volume fixer in the pic. The Blood.cfg tab has the resolution options like 640x480 and 800x600. It's much easier that way.