It appears that what you have is an OEM version of Windows 98 SE.

OEM versions are primarily intended for use on new computers and
therefore are specifically designed not to upgrade an existing version
of Windows.

You have several choices at this point.

1.  MVP Ron Badour has a web page with information about doing an
upgrade install with an OEM version of Windows.  This information is
more relevant to Windows 95 OEM versions than to Windows 98 but it may
just work.  See http://home.satx.rr.com/badour/html/upgrade.html

2.  Backup all of your data files to another hard drive or to
removable media of some kind and make sure you have the original CDs
needed to reinstall all of your application programs.  Then boot your
computer with a Windows 98 Startup Disk, reformat the hard drive, and
then install your OEM Windows 98 SE on the now empty hard drive.

3.  Check with eBay or other auction sites for a Retail Upgrade
version of Windows 98 SE.  This must be a retail product in a
Microsoft box.  Any that comes in a shrink-wrapped package and/or
includes some minor piece of computer hardware as part of the purchase
is going to be an OEM version, same as what you already have.

Good luck

Ron Martell     Duncan B.C.    Canada