Could you post a video so I can see what happens after you insert the disk? I assume that the trackdisk.device loader may be the problem on KS3.2 (the WHDLoad version uses dos.library for file-io).
Ok, then it's not a KS3.2 problem. Sorry that the game causes trouble with the ACA1221, but unfortunately I neither have a real A1200 nor the ACA1221 so I've no chance to debug and fix that. Sorry....