I see your situation this way:
- you have win98 on its part of hdd and you boot it with his boot loader from MBR - this seems to me as separate OS and you can reinstal it on his partition. If you stay on the same size of partition, there is no reason for win98 to interfere with Linux. You are the only one who deside how much of hdd will win98 use and how much will be for Linux.
- since you boot Linux with floppy there is no chance win98 can fool your floppy.