Hello again,
I did manage to find something called "FolderISO" freeware on softpedia, it was fairly simple to use. Simply right click on the CD/floppy in my computer and click "copy" and paste it in a folder on your computer. Then use FolderISO to create the ISO file and mount it with Daemon Tools. It worked well, however I had to find a program called "relaunch.exe" which bypassed some old Directx check on the game. Interestingly this was already included with the game, a rare find. :nuts:
Here's some teasers:
(click thumbnails to enlarge)

In the story the K'NEX Kids are building a crane, except the evil mine monsters come and steal all the parts while they are building it. Your mission as K'NEX Kid is to bring back the missing pieces, but it won't be easy because you have to fight off all sorts of difficulties and puzzles.
http://xs.to/xs.php?h=xs224&d=08056&f=menu312.png
Seems to be a good bit like an Isometric form of Vectorman. The graphics are very good for the time and they are certainly orignal.

Although the sound effects are good, it doesn't seem to have a soundtrack but it will play any music CD if it is in the Drive while the game is running, at least on my computer.