After experimenting a little I got it to install and run with no credits to Stardock support. I had it up and running before they even had a chance to reply on my support ticket.
I first uninstalled Impulse.
Then I had to manually go through my entire windows registry and delete each individual key related to Impulse, Stardock, and Demigod.
Deleted any remaining folders that had anything to do with Impulse. I left the game folders intact since they really didn't cause any troubles anyway.
Then I reinstalled impulse. I did however have to download and reinstall every program that I have registered with impulse. Not really a big deal just more time consuming than anything else.
Last program I installed was Demigod, it installed fine after all of the above, go figure. And now it runs without any problems (I have to disable comodo firewall though)
It's really quite a shame that I had to go through all of this after simply trying to update from one version of Demigod to another.
Apparently Stardock/Impulse has some problems they need to deal with, asap. I would hate to see if this actually happened to someone else not as knowledgable about computers and windows as I was, let alone to even think about manually editing the windows registry.