You have to unrar the main mod file and patch, and combine them. Overwrite the mod files with the patch ones.
One you have the '1200 Europe' folder combined you have to place it under Mount&Blade/Modules. The game folder 'Mount&Blade' is usually installed and therefore located under Program Files, though you might have installed in another place.
Once the module folder is under 'Modules' just click on the Mount&Blade desktop icon or exe and get to the first menu that appears in the centre of your desktop. In the upper part you have 'Current Module', were you can choose the model you want to play. Native is the original module (the one that comes with the game), just select 'Europe 1200' and click on 'Play Mount&Blade'. And Enjoy!
