bts does install a mock warlords installation when you install it with warlords not present - installing warlords afterwards could conceivably create a weird mixture of complete and incomplete files since bts only installs those files that it really needs...
Edit: also the warlords installer does not expect Civ4 to be patched to 1.74 which again might or might not cause troubles...
My hunch is that to fix this you'd need to uninstall bts then install warlords and reinstall bts or better do a complete reinstall like below...
Is this Windows xp or vista?
install the most recent version of DirectX 9c from
Microsoft
then do the following for a clean reinstall:
Uninstall and Reinstall Civ4 Warlords BtS :
Try to follow this order when doing stuff:
Use Control panel to uninstall Beyond the Sword, then Warlords, then Civ4
Delete "...\documents and settings\<username>\my documents\my games\sid meier's civilization 4" manually
Delete "...\documents and settings\<username>\my documents\my games\warlords" manually
Delete "...\documents and settings\<username>\my documents\my games\beyond the sword" manually
Delete "...\documents and settings\<username>\application data\my games\sid meier's civilization 4" manually
Delete "...\documents and settings\<username>\application data\my games\warlords" manually
Delete "...\documents and settings\<username>\application data\my games\beyond the sword" manually
Delete "...\documents and settings\<username>\local settings\application data\my games\sid meier's civilization 4" manually
Delete "...\documents and settings\<username>\local settings\application data\my games\warlords" manually
Delete "...\documents and settings\<username>\local settings\application data\my games\beyond the sword" manually
(note: application data is a hidden directory so you need to configure windows explorer to show hidden files, also these directories in application data are sometimes removed by the uninstall routine)
Delete "...\Program Files\InstallShield Installation Information\{CFBCE791-2D53-4FCE-B3FB-D6E01F4112E8}" (Civ4)
Delete "...\Program Files\InstallShield Installation Information\{3E4B349F-10B5-4586-9D99-489A90A8B228}" (Warlords)
Delete "...\Program Files\InstallShield Installation Information\{32E4F0D2-C135-475E-A841-1D59A0D22989}" (BtS)
(note: InstallShield Installation Information is a hidden directory so you need to configure windows explorer to show hidden files).
Install Civ4, immediately patch it to 1.61 (download it fresh from
here)
Install Warlords, immediately patch it to 2.08 (download it fresh from
here)
Install Beyond the Sword, immediately patch to 3.19 (download it fresh from
here).