Thanks Ken, turns out I had the service pack on my HD as well as WinXPsp3.
Sooooo, I removed the HD, put it in an external enclosure and copied the drivers for the cdwriter, win98, the win98sp2, winxpsp3 onto the drive and then put it back in the laptop.
Installed the Win 98 cd writer driver, no luck.
I installed the Win98 sp2, no love with it.
Tried to install WinXP from the HD, got error messages.
Finally figured out to try to reinstall the cdrom driver and it finally worked.
On to WinXP, installed from cdrom, no problem.
Final issue, touchscreen wouldn't work.
after trying the WinXP version that didn't work, I downloaded and installed the Win98 version and viola, I'm done!
So now it's just a matter of seeing which games will run and which will make the best of the 600mhz/128mb power.
BUT the big part is over, thanks to all who helped, it's good to know that there is a place that I can come and actually get the help I need without feeling like too much of a dumbass!

Thank You All!
ARCADIAC!