No, Installing XP may or may not fix the problem and it could be incompatible or have bigger problems. Windows 95/98 should work if configured properly and with good drivers.
I believe you have either
1. IRQ or Memory Address Conflict
2. Bad(poorly written) drivers
It is most likely that the Multimedia and the IrDA share an IRQ or memory location. You may be able to fix this by manually changing the settings from the Device Manager. Some devices are not very flexible so it might be difficult.
Keep in mind that most devices can share an IRQ with 2 other devices, however sometimes they are incompatible with the particular device they are paired with. Moving either or both device(s) may fix the problem. You may also freeup an IRQ by disabling a port, internal modem, or other (non-system device that is holding an IRQ.
It is also possible that one of the drivers is the problem. It is rarely a bad idea to check for a driver update. If you are going to update drivers, I suggest downloading the new ones and then booting to safe mode and deleting all instances of each device via the device manager. When the computer reboots it will reinstall each device and give you the opportunity to install the new drivers.They might even install with compatible settings and save you some work.
If you are not familiar with the device manager and changing settings, comment back.
Good Luck !