I have been using WinSE almost since it came out, and I have never had a problem with it.
However, I did start loading Win2000 pro and was met with a message that said "a number of your applications require upgrading with the manufacturers new drivers and DLL's before they can be used in Win2000." At that point I killed the setup and went back to Win98se.
My policy now is if it ain't broke don't fix it! Can't see the point of changing to something which causes so much aggro.