I'm using Headphones on my computer at all times and set windows' sound scheme to suit that. Everytime I start Sacrifice however, it changes this setting to Quadrophonic (4.0 setting), which results in an unpleasant sensation as far as sound goes. I tried setting the In-game speaker setting to 'Headphones', but to no avail. Changing the audio provider does not fix this either.
I am using Windows XP professional SP2 with a Soundblaster Live!5.1 sound card.
Does anyone know a solution to this?

Have you tried directly modifying the registry entry here:
HKEY_LOCAL_MACHINESOFTWAREShiny EntertainmentSacrificeOptionsSpeaker Setup
?
It may not work if the game executable itself is causing the setting switch each time it runs.