This is how I run Daggerfall on Win98.
Create a new MS-DOS Shortcut.
Right-Click the new shortcut to modify its properties and ensure that Protected and HMA checkboxes are checked on the Memory tab. All other memory settings should be at AUTO.
disable the screen saver, use exclusive mouse, and always suspend background. Install Daggerfall and setup the sound. Always run Daggerfall from the DOS prompt on your desktop, or you might run into problems.
Hmm I never had to do this on 98.
I just install the game and play right away without problems. :dance:
Then again, I play old DOS games on a 133MHZ. :thumbsup: