Fresh install of Win2000 or Upgrade 98?

Hi. We are thinking of upgrading our network of about 20 Windows 98 pc’s to Windows 2000. Other than the obvious hardware/software compatibily issues, are there any other things to take into consideration when doing this? Is it better to do an upgrade or backup the data, fdisk, and reload a fresh copy of Windows 2000 Professional? We use a medical package that certain components won’t work on an upgraded machine because the directory structure is maintained during an upgrade and the software can’t find the folders in the directories it expects to. I’ve also heard that USB ports may not function on an upgraded machine. Any ideas would be appreciated. Thanks.