You need to do a few things to get QuakewWorld running on Windows 7 x64 (and probably Vista/x32 as well). The main problem I encountered was an incompatible version or rsync that would crash and cause permission errors in the form of Access Denied messages. To fix this, download the latest Windows version of Quake2World:

http://satgnu.net/files/quake2world-win32-snapshot.zip

Then grab sereds’ cwrsync package:

http://sourceforge.net/projects/sereds/files/

Extract Quake2World to the root of your c: drive

Install or extract cwrsync and copy the contents of its bin directory to c:\quake2world, overwriting anything that gets in your way.

Now you can run Update.bat to download the game’s resources:

And voila!