I just installed Two Worlds 2.
Fired it up and it seems to be ok.

I have been playing Two Worlds 1 and want to finish it before I play Two Worlds 2.....but Two Worlds 1 now refuses to start.

Any ideas?

I found a solution for my issue and decided to post it here for anyone else who encounters the same issue.
The answer is from Toccatta at the Inside Two Worlds forums.

The most likely problem is that TW2 installs a newer version of PhysX than TW1 uses. If you overwrote the old PhysX drivers, TW1 won't operate on the newer one. I had that problem myself when I installed TW2 from GoG first and then tried to install TW1. I didn't want to overwrite the newer drivers with the older ones, but when I tried to run TW1, it just crashed.

I solved the problem by downloading "legacy" drivers from Nvidia. They're intended to allow you to run games designed with the older PhysX drivers without overwriting the newer ones.

You can find them here;
http://www.nvidia.com/object/physx-9.12.1031-legacy-driver.html