After some tinkering, I got it to work, thanks
Luckily I am a little savvy when it comes to managing files and folders, because:
1st- it wouldnt run from my desktop folder since it contained spaces in the path
2nd - I had to create the 'ace' subfolder in the Roms directory (folder) in order for it to work properly.
Here is my daphne_log.txt showing success:
--DAPHNE version 0.99.7
--Command line is: C:\Daphne\daphne.exe ace vldp -framefile C:\Daphne\roms\ace\ace_dvdrom.txt -fullscreen
--CPU : AuthenticAMD 1800 MHz || Mem : 512 megs
--OS : Windows XP/.NET || Video : RADEON X800 Series
Set 640x480 at 32 bpp with flags: 80000001
Initializing sound system ...
No joysticks detected
Loading ./roms/ace/sa_a3_u1.bin ... 8192 bytes read into memory
Loading ./roms/ace/sa_a3_u2.bin ... 8192 bytes read into memory
Loading ./roms/ace/sa_a3_u3.bin ... 8192 bytes read into memory
Loading ./roms/ace/sa_a3_u4.bin ... 8192 bytes read into memory
Loading ./roms/ace/sa_a3_u5.bin ... 8192 bytes read into memory
Framefile parse succeeded. Video/Audio directory is: C:/Daphne/roms/ace/./
YUV overlay is hardware accelerated.
Booting ROM ...
Play
LDP : disc is already playing, play command ignored
Play
Display disable received
Search to 148 received - [ 0] Introduction, Sequence 0 Attract Mode
NOTE: converting FPS from 23.976000 to 29.970000. This may be less accurate.
Play
Display disable received
Search to 44 received - [ 0] Introduction, Sequence 4 Attract Mode
Freeing memory used to store audio stream...
Display disable received
Search to 1148 received - [ 0] Introduction, Sequence 10 Attract Mode
NOTE: converting FPS from 23.976000 to 29.970000. This may be less accurate.
Display disable received
Search to 148 received - [ 0] Introduction, Sequence 0 Attract Mode
NOTE: converting FPS from 23.976000 to 29.970000. This may be less accurate.
Play
Freeing memory used to store audio stream...
Shutting down sound system...
Shutting down video display...