There are other free partition management software such as Ranish at
http://www.ranish.com/part/ which you can use instead of fdisk...
What is the username you are using in Win98? Have you got the same user in WinXP? In Win98, during login, you should not press Esc or Cancel button as you would not be entering the Windows Network... Also, try enabling Guest account in WinXP... Finally, try disabling the bband lan card... We can eliminate it as the source of the problem in that way...
Arun