Just realised.... ACPI causes this
I just realised, you are installing Win98.....on a NEW PC, am I right?
There is a problem in that case, newest hardware upsets Win98 quite a LOT. The problem is ACPI.
The solution is simple, add the "/p i" switch to the CD setup as...
SETUP /p i
In other words, put in the install CD, boot from it, then say you want to browse the CD. FDISK as required to set up the necessary free space, then type as above. It performs a normal install, but ACPI is not implemented. This solves a number of things, like your video problem and also USB problems
Good luck