there are some examples in shade-c 0.90 and 0.91, just check them, I did it too and they definitely work fine. last year I made some conversions for A8 (water and shadowmapping), you can find in the forum at contributions and user resources sections. shade-c 0.90 and 0.91 are for A7, and there are some wrong view flag settings resulting in incompatibility with fog, and other issues.
moreover, if you want to avoid a lot of work spent on conversion to A8, in my editor you can find a water shader and a shadowmapping rip of 0.91, consisting of only 4 .h and .c files and some .fx shaders...

the message is because you forgot to include d3d9.h by #include <d3d9.h> required by DX function calls. if you use 0.91 you need the following lines to be added:

Code:
#define PRAGMA_PATH "shade-c"
#define PRAGMA_PATH "stuff"

#include <acknex.h>
#include <default.c>
#include <d3d9.h>			

#include "sc_core.c";


// in water action:
	sc_water(my);


// after level load:
	//Setup Shade-C
	//setup shade-c. Activate everything as we want to use everything!
//	sc_bHDR = 0;
//	sc_bDOF = 0;
	sc_bRefract = 1;
	sc_bWater = 1;
	sc_bReflect = 1;
//	sc_bVolParts = 0;
	
	sc_setup();


shadowmapping requires some further stuff, but check the examples. sky should be set as volumetric particle to work fine.

Free world editor for 3D Gamestudio: MapBuilder Editor