I figured out an easy work around. I actually copied the entire "homeworld" folder, in it's entirety, from the "program files" directory of an older computer that was running Homeworld successfully. I then simply placed in on the hard drive (program files folder, but you can put it anywhere) of my Windows 7 computer, put the disk in the cd drive (or I get the "no cd" warning), and then click the "homeworld.exe" file in the homeworld folder on the Windows 7 machine. Voila. It runs. It doesn't need to be "installed" in the traditional sense to work.
I tried Cataclysm too, and it installed ok, but as soon as you run it, it pulls the "program stopped" warning. I tried it in every compatibility mode on the list. It actually gets past the Sierra and Relic splash screens, but then ceases to function. Literally just dropping the entire working folder, from CD that I had saved it on, to my Win7 computer was the only thing that worked.