I run LS on Win95 too, I also got the latest build, and also it said it couldnt find some missing .dll. However some IRC dude and I figured it was the addition of the !EmptyRecycleBin bang that borke 95 compatability.

I use all the other files in the build apart from LSapi.dll
and seeing that the only change (see changes.txt) was the emptyrecycle bang Im not really missing out on any important developments.