You'll need all the setup files too, the binaries. Otherwise you're not actually using the new version.
Ive just tried this 507.1286_byondexe.zip. Although when I run the game from the tlc folder it creates it works, but the Install.EXE is the one that still outputs the same error message once its been installed onto the computer and trying to run it.
I think I know, I checked the folder where it installs the game from the .EXE and noticed the files mfc120.dll, msvcp120.dll, msvcr120.dll, are missing.

http://files.byondhome.com/DarkerEmerald/aha.png

http://files.byondhome.com/DarkerEmerald/hah.png

So I dragged the missing files in the byondexe to where my game is installed and it works!

The problem is the byondexe is not packaging and instaling all the necessary files to make it work.
This is weird, because I specifically tested with the setup you shared with me. When you look at the properties for dreamseeker.exe, mydream.exe, etc. in your setup/bin dir, you're sure they're saying 507.1286? Because mydream.exe should be 52K, and have 507.1286 as its version. And you're sure it's grabbing those exact files when you build from the ini?
Yes I've confirmed I grabbed the right files, it's not packaging or installing those .dll I've mentioned for whatever reason.

The versions in the setup/bin for files 'byondcore.dll, byondext.dll, byondwin.dll, dreamseeker.exe, mydream.exe' are verion '5.0.507.1286'.
I've uninstalled, deleted and removed, everything and repacked a new installer it still not packaging and installing'mfc120.dll, msvcp120.dll, msvcr120.dll, steam_api.dll'
Think you can get me a new copy of your current setup? I'd like to compare and see what I'm missing. (BTW this may sound dumb, but are you using the new byondexe itself as well?)
Sure give me a moment, lol well yea I am, was I suppose to or use it with something else?
Ive pmed you the setup files.
I tried this and was unable to observe the same problem. It built game.exe for me (6,455,296 bytes) and I was able to run that, which unpacked all the files needed.

Here's a question that might be relevant: Is there any chance at all that you have a PATH entry that's pointing to a place where you have a different, older byondexe.exe? When I built this, I opened a command line directly in that dir and ran byondexe from there.
I do not know, I cleaned out my pc with and made sure everything that was byond was uninstalled and cleaned it out with the cmd to make sure it wasnt using an older versions.

PM me the TLC.EXE you created and ill try installing onto my PC.
I just noticed it didn't create a tlc.exe because there was an installer script error. (I've seen this before where it complains about GetSize, but I'm not sure why sometimes it happens and other times not.) It did create game.exe, which worked fine.
Oho! I see the problem now. It's in install.nsh. I'll give you patch instructions and this will be fixed in 508.1287.

At line 89, add:

  File "${FILEDIR}\msvcp120.dll"
File "${FILEDIR}\msvcr120.dll"
File "${FILEDIR}\mfc120.dll"
File "${FILEDIR}\steam_api.dll"

Line 117, add this (including the line break after):

!insertmacro GetSize

Further down, you'll see a list of uninstall files, and add this on line 165:
  Delete "$INSTDIR\msvcp120.dll"
Delete "$INSTDIR\msvcr120.dll"
Delete "$INSTDIR\mfc120.dll"
Delete "$INSTDIR\steam_api.dll"
Yea I kinda figured that was the problem too, I'll try it in a bit.
All right that seems to have been the problem. Works like it should thanks man.
Bump, this is still an issue. The above fix does not work.
Doohl, can you package up the entire dir you're using to build your standalone so I can have a look?
Sure. PMing you the download link now.
Your standalone dir shows you're using a way outdated version of byondexe, and there are multiple files missing from your setup/bin dir.
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