I have the game installed on my Windows7 desktop and the soundfont is working perfectly using bass midi driver.

On the other hand I tried setting this up on my Windows8 laptop but the sound didn't change at all. Music in game is now gone too and uninstalling bass midi driver changes nothing.

Does anyone know how to fix this?

I did some research a few months ago and sadly it seems that MS has lost the last bit of common sense and removed the ability to switch the default MIDI device in Windows 8 (that's what you needed to make all applications use BASS MIDI or other virtual MIDI devices of that kind). I haven't used Windows 8 or BASS MIDI myself yet but that's what I learned when I read the FAQ of Coolsoft MIDI Synth (a somewhat similar tool, I presume).

So I'm afraid that as long as the DOSBox team doesn't include internal MIDI emulation with support for soundfonts you can't get DOSBox games to use other MIDI devices than the awful default MIDI support of Windows. However, *does* have internal emulation for MIDI devices and allows you to use custom soundfonts without having to resort to external software like BASS MIDI. Problem is - Gabriel Knight still isn't officially supported by ScummVM. *But* according to [url=http://forums.scummvm.org/viewtopic.php?t=11785&sid=e14117bebd7b65bf2d59dd88d7426740]this thread it is possible to play Gabriel Knight through one of the daily builds. I haven't tried it (playing GK through ScummVM) myself yet but according to those posts it should work pretty much fine.