I get this message all the time with Jabo's Direct3D8 1.6. It's because I have an Intel video card. Luckily, gameplay will resume as normal (there's no need to restart the emulator), but the message will keep popping up randomly.
To fix it, (if you're in windowed mode) switch to fullscreen mode and then back to windowed mode again. It worked for me. You can then switch back to fullscreen if you want. You could alternatively just use Jabo's Direct3D6 1.5.2.
Jabo's beta video plugin, however (available only to those who donate to PJ), resolves the issue completely.
