Sorry but I'll mark this as a problem :-)

So I managed to configure blood setting and now I can play the game as a modern shooter.
Here's my blood.cfg file :

;-------------------------------------------------
;
;-------------------------------------------------

[Setup]
;Setup File for Blood
SetupVersion = "1.10"
;
;
[Screen Setup]
;
;
;ScreenMode
; - Chained - 0
; - Vesa 2.0 - 1
; - Screen Buffered - 2
; - Tseng optimized - 3
; - Paradise optimized - 4
; - S3 optimized - 5
; - RedBlue Stereo - 7
; - Crystal Eyes - 6
;
;ScreenWidth passed to engine
;
;ScreenHeight passed to engine
;
;
ScreenMode = 1
ScreenWidth = 800
ScreenHeight = 600
;
;
Size = 1
Gamma = 0
[Sound Setup]
;
;
FXDevice = 6
MusicDevice = 7
FXVolume = 220
MusicVolume = 200
NumVoices = 32
NumChannels = 2
NumBits = 16
MixRate = 44000
MidiPort = 0x330
BlasterAddress = 0x220
BlasterType = 6
BlasterInterrupt = 5
BlasterDma8 = 1
BlasterDma16 = 5
BlasterEmu = 0x620
ReverseStereo = 0
;
;
CDVolume = 255
[KeyDefinitions]
;
;
Move_Forward = "W" "KPad8"
Move_Backward = "S" "Kpad2"
Turn_Left = "Left" "Kpad4"
Turn_Right = "Right" "KPad6"
Turn_Around = "BakSpc" "N/A"
Strafe = "LAlt" "RAlt"
Strafe_Left = "A" "N/A"
Strafe_Right = "D" "N/A"
Jump = "Space" "/"
Crouch = "LCtrl" "N/A"
Run = "LShift" "RShift"
AutoRun = "CapLck" "N/A"
Open = "E" "N/A"
Weapon_Fire = "P" "RCtrl"
Weapon_Special_Fire = "O" "N/A"
Aim_Up = "Home" "KPad7"
Aim_Down = "End" "Kpad1"
Aim_Center = "KPad5" "N/A"
Look_Up = "PgUp" "Kpad9"
Look_Down = "PgDn" "Kpad3"
Tilt_Left = "Insert" "Kpad0"
Tilt_Right = "Delete" "Kpad."
Weapon_1 = "1" "N/A"
Weapon_2 = "2" "N/A"
Weapon_3 = "3" "N/A"
Weapon_4 = "4" "N/A"
Weapon_5 = "5" "N/A"
Weapon_6 = "6" "N/A"
Weapon_7 = "7" "N/A"
Weapon_8 = "8" "N/A"
Weapon_9 = "9" "N/A"
Weapon_10 = "0" "N/A"
Inventory_Use = "Enter" "KpdEnt"
Inventory_Left = "[" "N/A"
Inventory_Right = "]" "N/A"
Map_Toggle = "Tab" "N/A"
Map_Follow_Mode = "F" "N/A"
Shrink_Screen = "-" "Kpad-"
Enlarge_Screen = "=" "Kpad+"
Send_Message = "T" "N/A"
See_Coop_View = "K" "N/A"
See_Chase_View = "F7" "N/A"
Mouse_Aiming = "Q" "N/A"
Toggle_Crosshair = "I" "N/A"
Next_Weapon = "F" "N/A"
Previous_Weapon = "G" "N/A"
Holster_Weapon = "ScrLck" "N/A"
Show_Opponents_Weapon = "N" "N/A"
BeastVision = "B" "N/A"
CrystalBall = "C" "N/A"
JumpBoots = "J" "N/A"
MedKit = "M" "N/A"
ProximityBombs = "P" "N/A"
RemoteBombs = "R" "N/A"
;
;
[Controls]
;
;
;Controls
;
;ControllerType
; - Keyboard - 0
; - Keyboard and Mouse - 1
; - Keyboard and Joystick - 2
; - Keyboard and Gamepad - 4
; - Keyboard and External - 3
; - Keyboard and FlightStick - 5
; - Keyboard and ThrustMaster - 6
;
;
ControllerType = 1
JoystickPort = 0
MouseSensitivity = 42596
ExternalFilename = "EXTERNAL.EXE"
EnableRudder = 0
MouseAiming = 0
MouseAimingFlipped = 0
MouseButton0 = "Weapon_Fire"
MouseButtonClicked0 = ""
MouseButton1 = "Weapon_Special_Fire"
MouseButtonClicked1 = ""
MouseButton2 = "Mouse_Aiming"
MouseButtonClicked2 = ""
JoystickButton0 = "Weapon_Fire"
JoystickButtonClicked0 = ""
JoystickButton1 = "Strafe"
JoystickButtonClicked1 = "Inventory_Use"
JoystickButton2 = "Run"
JoystickButtonClicked2 = "Jump"
JoystickButton3 = "Open"
JoystickButtonClicked3 = "Crouch"
JoystickButton4 = "Aim_Down"
JoystickButtonClicked4 = ""
JoystickButton5 = ""
JoystickButtonClicked5 = ""
JoystickButton6 = "Aim_Up"
JoystickButtonClicked6 = ""
JoystickButton7 = ""
JoystickButtonClicked7 = ""
MouseAnalogAxes0 = "analog_turning"
MouseDigitalAxes0_0 = ""
MouseDigitalAxes0_1 = ""
MouseAnalogScale0 = 65536
MouseAnalogAxes1 = ""
MouseDigitalAxes1_0 = "Aim_Up"
MouseDigitalAxes1_1 = "Aim_Down"
MouseAnalogScale1 = 65536
JoystickAnalogAxes0 = "analog_turning"
JoystickDigitalAxes0_0 = ""
JoystickDigitalAxes0_1 = ""
JoystickAnalogScale0 = 65536
JoystickAnalogAxes1 = "analog_moving"
JoystickDigitalAxes1_0 = ""
JoystickDigitalAxes1_1 = ""
JoystickAnalogScale1 = 65536
JoystickAnalogAxes2 = "analog_strafing"
JoystickDigitalAxes2_0 = ""
JoystickDigitalAxes2_1 = ""
JoystickAnalogScale2 = 65536
JoystickAnalogAxes3 = ""
JoystickDigitalAxes3_0 = "Run"
JoystickDigitalAxes3_1 = ""
JoystickAnalogScale3 = 65536
GamePadDigitalAxes0_0 = "Turn_Left"
GamePadDigitalAxes0_1 = "Turn_Right"
GamePadDigitalAxes1_0 = "Move_Forward"
GamePadDigitalAxes1_1 = "Move_Backward"
;
;
TurnSpeed = 92
[Comm Setup]
;
;
ComPort = 2
IrqNumber = ~
UartAddress = ~
PortSpeed = 9600
ToneDial = 1
SocketNumber = ~
NumberPlayers = 2
ModemName = ""
InitString = "ATZ"
HangupString = "ATH0=0"
DialoutString = ""
PlayerName = "CALEB"
RTSName = "BLOOD.RTS"
RTSPath = ".\"
UserPath = ".\"
PhoneNumber = ""
ConnectType = 0
CommbatMacro#0 = "I love the smell of napalm..."
CommbatMacro#1 = "Is that gasoline I smell?"
CommbatMacro#2 = "Ta da!"
CommbatMacro#3 = "Who wants some, huh? Who's next?"
CommbatMacro#4 = "I have something for you."
CommbatMacro#5 = "You just gonna stand there..."
CommbatMacro#6 = "That'll teach ya!"
CommbatMacro#7 = "Ooh, that wasn't a bit nice."
CommbatMacro#8 = "Amateurs!"
CommbatMacro#9 = "Fool! You are already dead."
PhoneName#0 = ""
PhoneNumber#0 = ""
PhoneName#1 = ""
PhoneNumber#1 = ""
PhoneName#2 = ""
PhoneNumber#2 = ""
PhoneName#3 = ""
PhoneNumber#3 = ""
PhoneName#4 = ""
PhoneNumber#4 = ""
PhoneName#5 = ""
PhoneNumber#5 = ""
PhoneName#6 = ""
PhoneNumber#6 = ""
PhoneName#7 = ""
PhoneNumber#7 = ""
PhoneName#8 = ""
PhoneNumber#8 = ""
PhoneName#9 = ""
PhoneNumber#9 = ""
PhoneName#10 = ""
PhoneNumber#10 = ""
PhoneName#11 = ""
PhoneNumber#11 = ""
PhoneName#12 = ""
PhoneNumber#12 = ""
PhoneName#13 = ""
PhoneNumber#13 = ""
PhoneName#14 = ""
PhoneNumber#14 = ""
PhoneName#15 = ""
PhoneNumber#15 = ""
[Options]
Detail = 4
MouseAim = 1
AutoRun = 1
Interpolation = 1
ViewHBobbing = 1
ViewVBobbing = 1
FollowMap = 1
OverlayMap = 0
RotateMap = 0
AimReticle = 1
SlopeTilting = 1
MessageState = 1
MessageCount = 4
MessageTime = 5
MessageFont = 0
AdultContent = 0
AdultPassword = ""
Doppler = 1
ShowWeapon = 0
;------------------------------------------------------------
;
;-------------------------------------------------------------



You can back-up your old file and copy the content form here in it.
It's not perfect yet but movements and aiming are ok now.
You can do additional tunning after running setup.exe with dosbox.
Have on mind that with setup.exe you won't be able to remove moving for Y_mouse and you
have to edit blood.cfg manualy and set
MouseDigitalAxes0_1 = ""

also setup.exe can't remove action from double clicking on left-mouse button , and you have to set:
MouseButtonClicked2 = ""

I'll need to play a little be more for better tunning...Here you can assign more than one action to a button and only one annoying warning pops-up.At configuration above buttons are a mess.

And if anybody can propose better setup I'll be very glad :)

Nice play to everyone :)

here's the complete guide for movements:

Goto C:\Program Files (x86)\GOG.com\One Unit Whole Blood\DOSBOX and run dosbox

Execute following commands:
mount c "C:\Program Files (x86)\GOG.com\One Unit Whole Blood"
c:
setup.exe

You should see following screen


go to controller set-up and choose "Keyboard and Mouse" and press enter

Next choose "setup keyboard" and set your movement buttons.When you are ready press escape and go to "Setup Mouse".You can't leave double clicking without action so later you will need to edit blood.cfg file manualy.For now you can leave it just like that.
Other options are not important except may be mouse sensitivity.For me 1.20 works best.


Last option that you need to config via SETUP.EXE are "Advanced Control Options" and then "Advanced Mouse Setup"

Set :
Mouse X Axis as (analog_turning)
Mouse Y Axis as *Whatever you want* - later you will need to delete the value manualy

Mouse Forward as Aim_Up
Mouse Backwars as Aim_Down

and do not touch other properties.

Press esc until you reach "Save Settings before exiting" and press "Yes"

And finaly you need edit your BLOOD.CFG file.
And set following values as:

MouseAnalogAxes1 = ""

MouseButtonClicked0 = ""


Now you have "modern" FPS movements :)

Nice. It's nice to see things made nice and simple. Were you using the BMOUSE external program for mouse input?

It was the first I've ever heard about bmouse.(thans for that)
I've tried it and it's (a little bit) better than my configuration .
I can't use them together because the controller type is different (bmouse uses"Keyboard and external")

Definitely GOG must ship BUILD engine games with bmouse :-D ....

Thanks this is just what I needed. I'm too spoiled by modern FPSs to relearn the old ways.

When I edit my blood.cfg file with your text, the next time I try and start up the game, it crashes. It loads up dosbox, but a few seconds after that it completely closes to my desktop. Any solution? What am I messing up? XD

Could you paste here (or on pastebin.com) your cfg file?You can also just copy the mine from the first post.

Any way to set "Next" and "Previous Weapon" to the mouse wheel?

-EDIT- Try setting the "ScreenMode = 1" variable to "0"

In case anyone else wanted to know, you can change the keys within the SETUP.EXE too.

-EDIT 2-
Here, try using mine. Please note that I did change the some of the visual settings since I'm playing this on a 1080p monitor with the default resolution (320x200).

;-------------------------------------------------:
;-------------------------------------------------:

[Setup]
;Setup File for Blood
SetupVersion = "1.10"
;
;
[Screen Setup]
;
;
;ScreenMode
; - Chained - 0
; - Vesa 2.0 - 1
; - Screen Buffered - 2
; - Tseng optimized - 3
; - Paradise optimized - 4
; - S3 optimized - 5
; - RedBlue Stereo - 7
; - Crystal Eyes - 6
;
;ScreenWidth passed to engine
;
;ScreenHeight passed to engine
;
;
ScreenMode = 0
ScreenWidth = 320
ScreenHeight = 200
;
;
Size = 1
Gamma = 0
[Sound Setup]
;
;
FXDevice = 6
MusicDevice = 7
FXVolume = 256
MusicVolume = 256
NumVoices = 32
NumChannels = 2
NumBits = 16
MixRate = 44000
MidiPort = 0x330
BlasterAddress = 0x220
BlasterType = 6
BlasterInterrupt = 5
BlasterDma8 = 1
BlasterDma16 = 5
BlasterEmu = 0x620
ReverseStereo = 0
;
;
CDVolume = 255
[KeyDefinitions]
;
;
Move_Forward = "W" "N/A"
Move_Backward = "S" "N/A"
Turn_Left = "Left" "N/A"
Turn_Right = "Right" "N/A"
Turn_Around = "X" "N/A"
Strafe = "N/A" "N/A"
Strafe_Left = "A" "N/A"
Strafe_Right = "D" "N/A"
Jump = "Space" "N/A"
Crouch = "LCtrl" "N/A"
Run = "LShift" "N/A"
AutoRun = "CapLck" "N/A"
Open = "E" "N/A"
Weapon_Fire = "RShift" "N/A"
Weapon_Special_Fire = "RCtrl" "N/A"
Aim_Up = "Up" "N/A"
Aim_Down = "Down" "N/A"
Aim_Center = "N/A" "N/A"
Look_Up = "N/A" "N/A"
Look_Down = "N/A" "N/A"
Tilt_Left = "N/A" "N/A"
Tilt_Right = "N/A" "N/A"
Weapon_1 = "1" "N/A"
Weapon_2 = "2" "N/A"
Weapon_3 = "3" "N/A"
Weapon_4 = "4" "N/A"
Weapon_5 = "5" "N/A"
Weapon_6 = "6" "N/A"
Weapon_7 = "7" "N/A"
Weapon_8 = "8" "N/A"
Weapon_9 = "9" "N/A"
Weapon_10 = "0" "N/A"
Inventory_Use = "Enter" "KpdEnt"
Inventory_Left = "[" "N/A"
Inventory_Right = "]" "N/A"
Map_Toggle = "Tab" "N/A"
Map_Follow_Mode = "F" "N/A"
Shrink_Screen = "-" "Kpad-"
Enlarge_Screen = "=" "Kpad+"
Send_Message = "T" "N/A"
See_Coop_View = "K" "N/A"
See_Chase_View = "F7" "N/A"
Mouse_Aiming = "U" "N/A"
Toggle_Crosshair = "I" "N/A"
Next_Weapon = "'" "N/A"
Previous_Weapon = ";" "N/A"
Holster_Weapon = "ScrLck" "N/A"
Show_Opponents_Weapon = "W" "N/A"
BeastVision = "B" "N/A"
CrystalBall = "C" "N/A"
JumpBoots = "J" "N/A"
MedKit = "M" "N/A"
ProximityBombs = "P" "N/A"
RemoteBombs = "R" "N/A"
;
;
[Controls]
;
;
;Controls
;
;ControllerType
; - Keyboard - 0
; - Keyboard and Mouse - 1
; - Keyboard and Joystick - 2
; - Keyboard and Gamepad - 4
; - Keyboard and External - 3
; - Keyboard and FlightStick - 5
; - Keyboard and ThrustMaster - 6
;
;
ControllerType = 1
JoystickPort = 0
MouseSensitivity = 65536
ExternalFilename = "EXTERNAL.EXE"
EnableRudder = 0
MouseAiming = 0
MouseAimingFlipped = 0
MouseButton0 = "Weapon_Fire"
MouseButtonClicked0 = ""
MouseButton1 = "Weapon_Special_Fire"
MouseButtonClicked1 = ""
MouseButton2 = ""
MouseButtonClicked2 = ""
JoystickButton0 = "Weapon_Fire"
JoystickButtonClicked0 = ""
JoystickButton1 = "Strafe"
JoystickButtonClicked1 = "Inventory_Use"
JoystickButton2 = "Run"
JoystickButtonClicked2 = "Jump"
JoystickButton3 = "Open"
JoystickButtonClicked3 = "Crouch"
JoystickButton4 = "Aim_Down"
JoystickButtonClicked4 = ""
JoystickButton5 = ""
JoystickButtonClicked5 = ""
JoystickButton6 = "Aim_Up"
JoystickButtonClicked6 = ""
JoystickButton7 = ""
JoystickButtonClicked7 = ""
MouseAnalogAxes0 = "analog_turning"
MouseDigitalAxes0_0 = ""
MouseDigitalAxes0_1 = ""
MouseAnalogScale0 = 65536
MouseAnalogAxes1 = ""
MouseDigitalAxes1_0 = "Aim_Up"
MouseDigitalAxes1_1 = "Aim_Down"
MouseAnalogScale1 = 65536
JoystickAnalogAxes0 = "analog_turning"
JoystickDigitalAxes0_0 = ""
JoystickDigitalAxes0_1 = ""
JoystickAnalogScale0 = 65536
JoystickAnalogAxes1 = "analog_moving"
JoystickDigitalAxes1_0 = ""
JoystickDigitalAxes1_1 = ""
JoystickAnalogScale1 = 65536
JoystickAnalogAxes2 = "analog_strafing"
JoystickDigitalAxes2_0 = ""
JoystickDigitalAxes2_1 = ""
JoystickAnalogScale2 = 65536
JoystickAnalogAxes3 = ""
JoystickDigitalAxes3_0 = "Run"
JoystickDigitalAxes3_1 = ""
JoystickAnalogScale3 = 65536
GamePadDigitalAxes0_0 = "Turn_Left"
GamePadDigitalAxes0_1 = "Turn_Right"
GamePadDigitalAxes1_0 = "Move_Forward"
GamePadDigitalAxes1_1 = "Move_Backward"
;
;
TurnSpeed = 96
[Comm Setup]
;
;
ComPort = 2
IrqNumber = ~
UartAddress = ~
PortSpeed = 9600
ToneDial = 1
SocketNumber = ~
NumberPlayers = 2
ModemName = ""
InitString = "ATZ"
HangupString = "ATH0=0"
DialoutString = ""
PlayerName = "CALEB"
RTSName = "BLOOD.RTS"
RTSPath = ".\"
UserPath = ".\"
PhoneNumber = ""
ConnectType = 0
CommbatMacro#0 = "I love the smell of napalm..."
CommbatMacro#1 = "Is that gasoline I smell?"
CommbatMacro#2 = "Ta da!"
CommbatMacro#3 = "Who wants some, huh? Who's next?"
CommbatMacro#4 = "I have something for you."
CommbatMacro#5 = "You just gonna stand there..."
CommbatMacro#6 = "That'll teach ya!"
CommbatMacro#7 = "Ooh, that wasn't a bit nice."
CommbatMacro#8 = "Amateurs!"
CommbatMacro#9 = "Fool! You are already dead."
PhoneName#0 = ""
PhoneNumber#0 = ""
PhoneName#1 = ""
PhoneNumber#1 = ""
PhoneName#2 = ""
PhoneNumber#2 = ""
PhoneName#3 = ""
PhoneNumber#3 = ""
PhoneName#4 = ""
PhoneNumber#4 = ""
PhoneName#5 = ""
PhoneNumber#5 = ""
PhoneName#6 = ""
PhoneNumber#6 = ""
PhoneName#7 = ""
PhoneNumber#7 = ""
PhoneName#8 = ""
PhoneNumber#8 = ""
PhoneName#9 = ""
PhoneNumber#9 = ""
PhoneName#10 = ""
PhoneNumber#10 = ""
PhoneName#11 = ""
PhoneNumber#11 = ""
PhoneName#12 = ""
PhoneNumber#12 = ""
PhoneName#13 = ""
PhoneNumber#13 = ""
PhoneName#14 = ""
PhoneNumber#14 = ""
PhoneName#15 = ""
PhoneNumber#15 = ""
[Options]
Detail = 4
MouseAim = 1
AutoRun = 1
Interpolation = 1
ViewHBobbing = 1
ViewVBobbing = 1
FollowMap = 1
OverlayMap = 0
RotateMap = 0
AimReticle = 0
SlopeTilting = 1
MessageState = 1
MessageCount = 4
MessageTime = 5
MessageFont = 0
AdultContent = 0
AdultPassword = ""
Doppler = 1
ShowWeapon = 1

;-------------------------------------------------:
;-------------------------------------------------:

I don't think the BUILD engine supported mousewheel, but you could use GlovePIE to map the mousewheel up and down movement to a keyboard button, and then use those keys in the game's control setup. That way, when you are running GlovePIE with your mousewheel bindings set up the game will read them as the corresponding keypresses.

There's a way with autohotkey (or simple vbscript). But not possible without external program...

For bMouse you will want to change line 12 in dosboxBlood_single.conf to bmouse.exe launch blood.exe.

You will want to make sure that BMOUSE.EXE is in the game directory (not the DOSBOX directory).

This will cause bMouse to launch Blood, and it can then be used.

In BLOOD.CFG you will want to look for the following lines and adjust them as listed below ([...] represents variables in between the target variables).

ControllerType = 3
...
ExternalFilename = "BMOUSE.EXE"
...
MouseAnalogScale0 = 32768
...
MouseAnalogScale1 = -22938

Notice that I made no mention of actual mouse sensitivity, even though it exists in the config. file. This is because it does not appear to be used by bMouse 1.6.
Instead you will want to modify the scale, as shown.
The negative value for the Y axis / ...Scale1 will invert the mouse, so that it has modern behavior.

You can see the Y axis is roughly 0.7 of the X axis in scale, this is just my own preference, and you can set any of these values from 0 to 65536 (the value range of data-type: short).

Here is a suggestion for the Middle Mouse Button as well.

MouseButton2 = "MedKit"