Striker:
I installed FA on a Win98SE box and got it working just fine. Here's what did:
1. Installed Win98SE on the C-drive, which was uncompressed, formatted with FAT-16 (not FAT-32), and had several gigs of free space.
2. Installed the "Unofficial Windows 98 SE Service Pack," which effectively installs all the patches and updates that Microsoft released for Win98SE:
http://exuberant.ms11.net/98sesp.html
3. Installed the latest Win98 sound and video drivers from the manufacturers. When downloading Win98 compatible drivers, be sure to note the version of DirectX required. Win98 installs with DirectX 6. You may need to update to DirectX 8 or 9, depending on the drivers you're using.
4. Installed the appropriate version of DirectX for the sound and video drivers. This actually should be done before you attempt to install the drivers.
5. Used the MSCONFIG utility to ensure that a minimum of programs were auto-starting with Windows. Particularly troublesome are resident programs that hook the keyboard (usually to provide extra hot-key support), which (in my experience) can cause you to temporarily lose the keyboard while in FA. In my case I had to disable the tray utility that my video driver installed (which didn't affect the drivers for the card at all).
6. Installed software for my joystick & throttle (HOTAS Cougar) and verified both, along with my rudder pedals, were working in the Control Panel game controllers applet.
FA works beautifully in Win98SE for me. The drivers for the video card I'm using do lose some ground textures, but that's the only anomaly that I've noted.
Others more experienced with FA here may have additional advice.
Best,
Eric L. Howes