This might be one way to run it (maybe best way):
I ran it in Win XP SP2 with vdms. It seems to run at a different speed compared to dosbox. It feels a bit slower, still smooth, but somehow feels "right". Maybe that is the intended speed.
I haven't tried the next suggestion but this just sprang to mind: I think the best way to get joypads and sticks to work for 2ply gameplay should be to use joy2key and map your windows joysticks onto keyboard keys. Then setup those keys in supercars!
If it works, one should even be able to use 2 amiga joysticks to play this gem! YES!
Note: I think vdms adds a bit more than just sound to dos games in winxp, e.g. extended memory or whatnot. To run with vdms: Just install vdms, right click on supacars.exe in windows and select "run with vdms". This is assuming the soundblaster parameters in vdms.ini file match those that you set for supercars.