Upgading Win 98 to XP

I will give you a "qualified" yes.

However, many users have reported problems performing the upgrade.
Once the upgrade fails, they are usually forced to format the hard drive and start over.

So, before you start, back up all critical files and settings.

2 options to avoid the problem.
1. Add a second hard drive to your system, and install XP to the second drive as a "dual-boot".
Then use the files and settings transfer wizzard in XP to import your W98 settings into XP.
2. Borrow another system.
Install your W98 drive in this other system.
Install XP onto a new drive in your system.
(You will need your W98 CD to show XP that you qualify for the upgrade version, if that is the version you have)
Connect the 2 computers, anduse the files and settings transfer wizzard to import your W98 settings.
You can use either direct cable connection, or peer-to-peer using NIC's and a crossovr cable.

Chas

Greetings
Having done upgrades before they can be full of hidden problems. On my own system at home I used the dual boot option as suggested in the first answer. You will find that although it can be a bit of a bind checking through settings etc. It would be well worth it in the long run.
If access to other HDD is an issue then you can try Partition magic (PowerQuest) and try placing on the same HDD but on a differnt partition

What ever you decide. Best of Luck