First things first...ALWAYS back up your system before playing with the partitions. I agree with using partition magic, however since you already have the system backed up you can completely wipe the hard drive then execute FDISK setting up the Win98 partition. Depending on whether you want 98 to be able to "see" the NT paritions or not you should leave the remainder of the disk alone as NT will take care of it for you during the install process. The system partition for NT can only be 4gb.Once you install SP4 and reboot you can use Disk Administrator (START-->programs-->admin tools common-->disk administrator) to create and format the larger paritition any way you like. You can boot the Win98 CD rom first (after backing up the system!!) and just boot to a command prompt with CD-rom support to use FDISK. Make sure to NOT enable the FAT 32 option. You can always convert AFTER the install. Then you can simply restore the backup to the first partition.
Hope I haven't confusedyou....let me know i