W Collins,
My friend had 98ME and asked me to help him out quite a bit. I didn't like it at all, so I agree with your reservations. At the time I had a fully updated 98SE and found that very much preferable.
However the 98ME defragger is just fine on 98SE or just '98. If you sort out the suspected underlying probs with the system you're working on, the 98ME defragger is the way to go. I used it on SE for some time - 18 months to two years, maybe, on an old and delicate 233 Meg P2 working to its limit. No problems.
AA