I did a search for "creating startup disk in Windows 98" and found the "how to" that relates to the Add/Remove/Startup Disk method.
I attempted to create a startup disk using that method, but the process hangs at 2% and I get an error that says, "Setup cannot copy all of the files from your Windows 98 CD. Clean the Windows 98 CD with a soft cloth, return it to the CD-ROM drive, and then click OK. If you receive this message again, read the CAB Errors section of the Setup.txt file. This file is in the Win98 directory of your Windows 98 CD."
I opened up my Windows 98 disk and read the portion of the setup file on CAB file errors. I followed the directions to bypass this problem, but it's still not working.
I currently do not have a startup disk, and I need one before I reformat my hard drive.
I hope that helps explains things!