As to speed, there is a bug in one of the networking components that can cause problems with CPUs faster than 2.1 GHz.
I know that I saw a Microsoft Knowledge Base article on this, just can't find it at this moment.
While Max is correct that you can setup Windows 98 to use more than 511MB of RAM, benchmark tests show W98 starts to have reduced performance when you increase RAM beyond 196MB.
The true hardware issue for Windows 98 is going to be device drivers.
VIA for one, recommends using their older drivers for W98 systems. Which means that you don't get the full use of all features on newer chip-sets.
Even with the updated version of Fdisk from Microsoft, you cannot partition a hard drive larger than 137GB.
(You may be able to get past this with a drive manufactures setup utility.)
Many USB flash drives do not work on W98 systems.
Then there is the security issue. Microsoft is only issuing patches for W98 flaws that it considers to be critical. There have been a number of updates that were assigned critical status for Windows 2000 and XP, but not for W98. If you take a W98 system on line, (even with dial-up) you should use a firewall.
My advise would be to evaluate why you are sticking with W98. If the software that you use will not run on Windows 2000 or XP, I suggest stocking up on old motherboards and CPUs.
Further, burn multiple copies of device drivers and Windows patches. They won't be available for download forever.
Chas