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Every time I boot up Battle Stadium D.O.N I'm in the memory card menu and it says. 
" There is no game data on the memory card [ps2] in memory card slot 1. [ you need 65kb or more of free space] Do you want to continue the game? 
and the yes or no option.
every time I click yes, the game does not start and stays on the same page.
i have checked my memory card slot too make sure i have 64kb of memory and I do, and it still does not start, please help.

Please post your emulog (in 1.7 it's tools -> enable file logging).
It sounds like your memory card isn't compatible with the game for some reason, perhaps it's not in the format the game itself expects. Sometimes PS2 games are finicky about it. You could always create a blank card specifically for that game though, it's under the memory card options menu.