This is the second time this has happened to me but i forgot how to fix it so if someone would help me out here.
I just reinstalled the game but I can't go to the Wizards building, Town Hall, Tavern, or the exit that leads towards the graveyards.

Useul info... Yes, i do have a party, Yes, Gareth has talked to me, Yes I have been everywhere i can go inside the town.
HELP ME PLEASE!!!!

It's probably the VirtualDub fix:

The fix is to uncompress the town video file using a free utility called: Virtualdub:
Go to the following site: http://www186.pair.com/vdub/

Once you're there, download Virtualdub, install it, and then load the file "townmsk1.avi" from the "Townavi" directory in your Wizards & Warriors folder into Virtualdub. Save it with the "Save as old-format AVI" option with a new file name. You will get back a 32MB file. Close out Virtualdub and then rename the new file townmsk1.avi (over the old file). Do the same procedure to the other two town mask files.