I haven't gone from windows 98 to 2000, but I did go from 98SE to XP, which is fairly similar. I've only done clean installs of Windows 2000, though.
First- Windows 2000 includes the ability to in-place upgrade windows 95,98, and NT computers; if you went with that option, you probably wouldn't lose any settings/programs (unforeseen circumstances notwithstanding)
I personally was concerned when I upgraded to XP about my game performance; I don't think it was affected adversely, but I believe I did notice an impact (mostly that I needed to find a 3rd party patch for Need for speed
)
Otherwise, it should be a fairly smooth transition.