There is an old PC windows version, a dos version, and the enhanced version. I tried enhanced recently and it was a lot of fun. Tonight at Summoning's I got some MKII retraining but after that I introduced him to MKT on PSX since he never actually played it. We tried the PC version but it had issues with the inputs like you mentioned, and also I get the color issues as well. For whatever reason we couldn't use the 360 of PSX sticks, it only registers buttons, I guess it's just too old. I'm sure there's a way to map them tot he keyboard but we didn't have the time or desire to go through all that.
Instead, we played PSX MKT, at 54fps (instead of 60) and I had the throttle option set at all times so I could press it and skip all loading time instantly. That came very in handy. He definitely enjoyed being able to use the MK and MKII characters, and I showed him and Steve N. why Noob and Rain are so broken, and the usefulness of the Scorpion forward Teleport Punch. Corner combo spear, RH, FTP, aaLP, spear, HK, HK for 52% and forward teleport punishers on blocked JKs.
Playing MKT really makes me want to do it better more and more. All those remaining characters from MK and MKII, all those frames of animation that could be used to make better looking, more varied combos. It's begging for it.
Edit:
I fixed some typos and added some info the main post. I will try to bust through some preliminary guides for the MKT characters and throw them into their respective threads later today. You guys can add whatever info you want to them and we'll sift through what's good.