If you're OK with FDisk, you can use DelPart to obliterate the partition and start from scratch. I have a bootdisk available that contains real mode mouse and CD drivers plus DelPart and other tools if you want to use it.
Otherwise, boot from the Win98 bootdisk to the A:/> prompt and type the following:
format c: /q /u <enter>
x: <enter>
setup /ie /im /is /nr <enter>
Where x: is your CD ROM drive letter. Don't forget that the Win98 bootdisk installs a RAM drive at the first available slot so your CD ROMs usual drive letter will be pushed back. In other words, if it's normally at D:, it will now be at E:.
As always, choose a custom installation and install only what you want.