1 - Transfusion is for multiplayer only, and it is not a fanmade crap; it will be the new way to play blood when the single player portion be done 'cause Monolith sucks and won't release Blood's source code, wich is needed in order for the programmers to make a port of sorts, wich would allow people to play Blood perfectly under Windows XP;
2 - DosBOX totally sucks. On better computers it runs the game nice, but on slower computers [such as mine] it will just suck, and the music didn't work here anyway with DosBOX;
3 - There is no special "XP" Blood.
So? Well, there are two options left:
A - Take that old MMX from the garage, format it and play raw Blood perfectly, or
B - Do the following:
Get to Google and get VDM Sound, NOLFB, Cli2nop and put'em in the Blood directory, except for VDM Sound, wich you must just install
Now go to Start>Run, type CMD and hit enter; browse to the blood directory then type nolfb and hit enter, then type cli2nop and hit enter, then exit.
Right-click Setup.exe and choose Run with VDM Sound, then setup the sounds like this:
Sound Blaster [if available, SB16 or AWE]
IRQ 5 [if doesn't work, try 7]
DMA 8 must be like 1 and DMA 16 must be like 3, just don't change them
Finish the VDM thingy wizard, go to the setup screen and try running the game. It must work at this point. If it doesn't, try running it from the prompt screen [do the cmd thing and try the game thru setup.exe]
If all the voodoo above don't work, THEN try dosbox, wich is the heavyest option.
If the game works but is unplayable, consider the MMX at the garage

p.s.: there are many pages related to running blood and even more wich focus on running BUILD games on XP, wich must be easier to find. I've seen some info on how to make it at cruduxcruo.com some time ago ^^