The game? That's completely irrelevant. It's just that the installer is a 16-bit Windows program. The Windows 3.11 generation.
More then a little bit of a bump but I wanted to explain this a bit more. Installshield was the dominant installer followed closely by Wise, and it only supported 16 bit installations at the time (which windows dropped support for in exchange for 32 bit support in 64 bit systems).
You can indeed copy the music etc from the CD to the "Lite" version of the GruntMods Edition, just make sure not to overwrite anything in the GruntMods directory.