I finally got my copy working on XP thanks to the forums. I totally gave up on Vista and "upgraded" back to XP-SP3. To get the game to run I:
* updated my video card drivers
* upgraded to Catalyst 7.12
* created a new Hotmail account
* uninstalled Microsoft Games for Windows - LIVE Redistributable
* reinstalled it from the Kane and Lynch DVD
* The game ran, updated my LIVE junk and then crashed
* After that the game loaded up fine
* Lowered the sound settings in DirectX
* Switched my screen rez from 1440 X 900 to a lower setting

The only odd thing: My LIVE account says it's invalid everytime, but the game fires up and runs anyway. I lowered the screen rez, but there's only one other 16:10 rez listed, all the smaller rez's shove the screen all the way to the right side when I play. Any chance there's an easy fix for this? Any way to get it to play as 1024 x 768 centered on a 16x10 wide-screen?