I doubt that this is possible but since your memory is at fault, try these
step by step procedures:

http://home.satx.rr.com/badour/html/w98_restore.html

You can just install the upgrade disk and during installation, it will ask
to see a qualify system (i.e., W98 or W95).

Sure.  This is called a blind multi-session bootable CD.  "blind" because
you cannot see the first session (bootable)with normal file viewing tools.
The only requirement is the PC bios must be set to, and be able to, boot
from the CD device first when its inserted in it.

You need a burning program such as Nero to create a bootable CD from a win98
startup diskette first.  While selection of choices for this burn is done,
leave the session OPEN.  Complete this operation.

Next.  You either have to copy the win98 install CD to your HD, or have
another CD rom/reader with the win98 cd in place.  In Nero or whatever, copy
the files from the HD (win98 install CD files and folders), or directly from
the win98 CD itself, whatever is appropriate.  When selecting options for
the burn, use ISO format, and close session.

Whatever else you wanted to burn to this CD should be copied during the
above session.  Organization is key here for finding later on the CD.  Use
descriptive folder names as a reminder.  Put the product key in a text file
on the root of the second session.  Use a descriptive filename for a
reminder.  Also, make a sticker for the CD with same product key on it as
part of the CD name.  For instance:
Bootable Win98 installCD
Prod key: XXXX-XXXX-XXXX-XXXX

Such a CD should be your user CD, save original win98 install CD for
archival purposes in safe place, with the actual product key label that came
with it.

Also suggest making an archival copy of the 98SE upgrade CD for actual
usage.  Same drill as above for reminders on prod key.

But for practical complete reinstall, you might just reverse this and save
the 98SE upgrade CD with the boot diskette image (bootable CD).  98SE
upgrade CD just needs to examine the qualifying product before installing.
If you mean the 98SE update CD, that's something else; and should be done as
noted previously.

I had the same problem.  I called Microsoft.  "Sorry" they
said, Microsoft does not support windows 98 because it is
out of warranty.  So much for Microsoft.