I used Voice Shaper with an ICOM 756 Pro III, a TS-440S, and my Viking rig. I ran the output of the soundcard through a 1:1 audio transformer (1k to 1k) and into the back panel of the Pro III, or the balanced input of a JBL Compressor/Limiter used to drive the balanced modulator of the TS-440S, or the AUX input of the amplifier that was used to drive the grids of the 811A's in the modulator deck for the Viking. It worked quite well, but as you said, Voice Shaper doesn't cut it with Windows 7 or any of the newer soundcards or integrated soundchips on new motherboards. I haven't found anything in the free category like Voice Shaper, but there are some pretty nice packages out there for $. Breakaway Broadcast looks like quite a package. I believe Blaine N1GTU has used it with very good success. I came across this a few weeks ago:
http://www.ikmultimedia.com/t-racks/features/It looked pretty cool but I have no idea whether it will do real-time voice processing like Voice Shaper. I've moved back to hardware voice processing with my plate modulated rig, but would be curious what you find.
73,
Rob W1AEX