It is almost certainly something related to a windows patch or nvidia patch because I have two computers and the main difference is one doesn't receive windows updates. The one without windows updates runs the game.

The differences that I can see are:
Steam Updates (Updated, still working)
Nvidia Updates (Updated, still working)
Windows Updates (Windows 10) (Have not tested, but if someone wants to revert back to a pre-October build to test, the update that broke the game should be sometime between June to mid October)

Other things that have been tried (or were already the case) based on the email sent from support:
1) Forced usage of Nvidia GPU
2) Reinstall the game
3) Update Graphics Driver
4) Update Windows
5) Verify Sound Card
6) Skipped as it could lead to problems and graphics drivers being updated did not cause a problem on the other computer.
7) Verify File Integrity
8) Deactivated Antialiasing
9) Reinstalled Visual Studio 2012 Visual C++ redistributable
10) Disabled steam overlay
11) Changed Antialias to App controlled.
12) Disabled Nvidia Geforce Experience Share video game recording feature
13) Reinstalled drivers
14) Wasn't using G-Sync so doesn't apply.
15) Disabled Antivirus
16) CPU was not overclocked
17) Turned on Game Mode
18) Not on Win8.1, but tried compatibility mode anyway.
19) If all the above procedures do not resolve the phenomenon, it may be an environment-dependent issue, since we have not received similar inquires.
We would appreciate it if you could play the game on another computer that runs it properly.

So basically support amount to: Well, since it is broke now, go play it on a computer that still runs it.

Other things I have tried:
Tried changing the language to pull the JP version - JP version also crashes.
Changed region.
Plugged in a controller.
Tried integrated graphics.
Received a new Win10 update, still no good.
Tried a new game, crashed at the same point as the below link.
Updated to win11, no good. Updates did not help.

See also: https://gtm.steamproxy.vip/app/636570/discussions/0/3157579842176011277/

If you happen to have a chance, go to the KTA support page and report the issue.

Try Windows 8 compatibility mode....

Tried compatibility mode as well (as mentioned in my previous post). This time, I attached a debugger and this is the error I get:

Exception thrown at 0x0000000140357E38 in Nights of Azure 2_En.exe: 0xC0000005: Access violation reading location 0x00000001C4873393.

I think there is some kind of error with the ShaderCache

A lot of these early-ish console ports to PC suffer from these kind of errors quite often. For instance, in YS VIII I believe you had to go in and figure out how to limit the game to only using one CPU core or it risked inevitably crashing at certain scenes. Not sure if the developers ever patched those issues or not, but yeah older console ports for PC tend to have those kind of issues in higher rate (especially from Japanese developers) than the newer games. I do not suspect the developers will be back to fix the issues for this game, especially since it seems to be a dead brand by this point, so learning some of the tricks someone else posted here for yourself is likely the best bet.

Originally posted by 729:

A lot of these early-ish console ports to PC suffer from these kind of errors quite often. For instance, in YS VIII I believe you had to go in and figure out how to limit the game to only using one CPU core or it risked inevitably crashing at certain scenes. Not sure if the developers ever patched those issues or not, but yeah older console ports for PC tend to have those kind of issues in higher rate (especially from Japanese developers) than the newer games. I do not suspect the developers will be back to fix the issues for this game, especially since it seems to be a dead brand by this point, so learning some of the tricks someone else posted here for yourself is likely the best bet.

problem is solved: https://gtm.steamproxy.vip/app/636570/discussions/0/5551280551728557766/