I can sympathize with your plight.  I remember trying to get the 3dfx patch to work on a Pentium MMX 233 MHz processor with a Creative Labs Voodoo2 card years ago.  I also tried to get it to work in a Pentium III 933 MHz system with a Voodoo5 card.  Unfortunately, I didn't take any notes, so I can't remember exactly what I did.  I do recall that I had zero success getting 3dfx support to work with the Voodoo5.  I also recall that I was able to get 3dfx support to work with the Creative Labs Voodoo2, but it had texture problems and other peculiarities as well (it looked more like a hack than a proper patch).

You mentioned that you used the overlay file from the Version 2.56 Reference Drivers.  I would suggest that you try earlier versions as well, particularly in the vicinity of Version 2.43.  I recall having to try a number of different versions before I stumbled across one that worked.  Also, it might pay to try the overlay file from the drivers for your specific card (if they are available) since it seemed to help some of the folks seeking assistance from Blue Byte:

http://www.bluebyte.net/eng/products/archimedean-dynasty/tips_3dfx.htm

The .ovl file IS the DOS driver for the card, so unless a card is an exact clone of a 3dfx reference design, it will have slightly different capabilities and operating characteristics which will require a different driver (.ovl file) to fully exploit the card's capabilities.  The differences between a given Voodoo and Voodoo2 will be even greater than the differences between two Voodoo2 cards from two different manufacturers since the Voodoo and Voodoo2 are two separate designs, so you can't really expect driver compatibility. 3dfx and Voodoo/Voodoo2 manufacturers didn't produce drivers with the sort of unified design that NVIDIA has which span multiple generations of cards.

If you want to avoid damaging your Voodoo2 card, you should probably stick to the drivers released by your card's manufacturer for that particular card, the 3dfx Voodoo2 Reference drivers, or 3rd party drivers designed to work specifically with Voodoo2.

Edit:  I unpacked my old 233 MHz Pentium machine and fired it up.  The machine is using the latest 3dfx Reference drivers (I think the Glide version is 2.56).  AD would kick me back to the desktop when I tried to used the 3dfx version of the program.

I copied the .ovl file from the Creative Labs driver disk into the game directory, and it works (sort of).  I get the splash screen, and the game runs fine, but it looks bizarre.  You can only see the 3D textures on objects when you are really close to them.  At a distance, you can see objects, but they are yellow all over.  Here is an excerpt from the readme file to let you know what the version numbers are for this Creative driver set:

3D Blaster Voodoo2
README.TXT
Copyright 1998, Creative Technology Ltd.
All Rights Reserved

Creative Labs, Inc.
1901 McCarthy Blvd.
Milpitas, CA  95035

www.soundblaster.com


=======================================================================
1. Summary of CD Contents
=======================================================================

1.1 Driver Information
    ------------------
* Direct3D v2.16 Drivers and Glide v2.50 RC1 (Win32) Drivers
* Glide Driver Version: 2.50 RC1 (for Win95)
* Glide Driver Version: 2.50 RC1 (for WinNT 4.0)
* Voodoo2 DirectX Driver Version: 2.16 RC1
* D3D Voodoo2 Driver Build Number: 4.10.01.0053 RC1

1.2 Files included on this CD
    -------------------------
\               - Root directory
   3DFXV2.DRV   - Direct Draw Driver
   3DFX16V2.DLL - DirectDraw 16-bit DLL
   3DFX32V2.DLL - DirectDraw 32-bit DLL
   FXMEMMAP.VXD - Voodoo VXD for mapping memory
   MSVCRT.DLL   - Microsoft Redistributable File
   GLIDE2X.DLL  - Glide for Voodoo2/WIN32 (Supports GLIDE 2.2 or higher)
   GLIDE2X.OVL  - Glide for Voodoo2/DOS
   FXOEM2X.DLL  - OEM extension file for Glide on Voodoo2/WIN32
   VOODOO2.DLL  - Voodoo2 Control Panel
   VOODOO2.HLP  - Voodoo2 Control Panel Help file
   VOODOO2.INF  - INF file for installing drivers
   README.TXT   - This file
   3DFXV2PS.DLL - Voodoo 2 Display Control Page
   3DFXV2PS.HLP - Help file for Voodoo 2 Display Control Page
   40COMUPD.EXE - Microsoft Redistributable Common Update
   CSH.DLL      - Redistributable Dynamic Library
   RICHED20.DLL - Redistributable Dynamic Library

\NT40           - Folder with Windows NT 4.0 drivers
   GLIDE2X.DLL  - Glide for Voodoo/Windows NT
   FXOEM2X.DLL  - OEM extension file for Glide on Voodoo/Windows NT
   FXGPIO.SYS   - Windows NT Device Driver for Voodoo Graphics
   FXPTL.SYS    - Windows NT Device Driver for Voodoo Graphics
   NTREMAP.SYS  - Windows NT Device Driver for Voodoo Graphics
   README.TXT   - README.TXT file for NT drivers

\DirectX        - Folder with Microsoft DirectX 5.0 runtime components.
                 Setup is located in \DirectX\DirectX\DXSETUP.EXE



I don't know if Creative has altered the .ovl file relative to a 3dfx Reference Driver package, and this driver might give you different results if you don't have a Creative Labs card.  You might try the Reference Drivers in FalconFly's archive:

http://www.falconfly.de/voodoo2.htm

I cycled through a number of 3dfx Reference Driver releases this morning, and here are my results:

v2-w9x-1.02.50.exe (Glide 2.50) - This seems to work well.  The new keyboard commands described in the AD 3dfx README.TXT file seem to work (Bilinear interpolation (Shift-F1) and the Gamma Correction (Shift-F3) have an obvious effect, although Dithering (Shift-F2) does not).

v2-w9x-1.02.51.exe (Glide 2.51) - Same results as Glide 2.50, seems to work properly.

v2-w9x-1.03.00.exe (Glide 2.53) - The game still runs in 3dfx mode and looks correct, but the Gamma Correction (Shift-F3) no longer works.

v2-w9x-3.01.00.exe (Glide 2.54) - Game exits to desktop with no error message once the Instant Action is supposed to begin.

v2-w9x-3.02.02.exe (Glide 2.56) - Same as Glide 2.54, exits to desktop with no message.


With this Creative Labs 3D Blaster Model 3DB6670, I don't have to use any environment commands as you apparently had to.  So it looks like Glide 2.50 or 2.51 are the magic numbers.  I am glad you got it to work.