Is it possible to play Outpost on a modern OS?
Solution 1:
You could set up a virtual machine running Windows 95 using Virtualbox or VMWare or Windows 7's built-in Virtual PC. The only thing you'd need is a Windows 95 CD and installation key.
I have no idea how it will play out - graphics and sound may both be an issue, and require additional drivers - but I'd say it's worth a try.
Solution 2:
According to The Outpost Universe installing on XP should be possible. Maybe their installation instructions will help you.