oah, someone will give you an informed answer, but given that I have done this with Win98 and Windows 2000, I should think that it is likely that you can either have a dual boot system or load WinXP on top of Win98.
But it is unlikely that you will be able to delete Win98 as a separate operation after assuring yourself that you are happy with XP.
Standby for someone who's done exactly what you're asking about.