Ive had a similar problem with the 16bit ODBC drivers for SQL server. Thunking will work ok with older releases, but not with newer versions of drivers.
In addition, it becomes more and more difficult to get 16bit ODBC to work on Windows XP machines. There is very limited (if any) support for 16bit ODBC anymore.
You need to bite the bullet and move to the 32bit world.