The gearsppc runs awesome on my machine, but its an A4000 not A1200. I have PowerUp "Terminator2" selected. "No Patch" is checked. VideoAddress is set to "Always". No other options are checked. I have ppclibemu.library installed in LIBS: and I "initialize" it in my startup-sequence like this, "c:ppcinstall >NIL:". One reason the demos might be failing on your machine is insufficient stack memory. Try using the "stack" command and set to a higher value. Another possible cause is hardware- specifically, memory. Are you running 60ns or 70ns SIMMs?
Do you have the memory speed set accordingly in the Blizzard's NVRAM? In order to run at 60ns, the memory must be high quality, seated properly, and be in exactly matched sets. Again, my setup is an A4000 so all of what I said may not apply in your system (I've never owned a Blizzard cardd and I'm really not sure how different they are from the Cyberstorms..). The only other thing I noticed from your initial post was the ENV-Variable "Memsize". I believe that should be set to "256" if you have a Voodoo Card with 16M and "512" otherwise. There is also a jumper on the Mediator which corresponds to this value (at least there is on mine). Another thing to check is your Picasso96 tooltypes and environment variables. Overclocking enabled? Blitter enabled/disabled? Clockfrequency set right? Etc.. From what you report, I kind of suspect the problem is your RAM and/or memory settings.