The reason USB doesn't work as well as it does with 2000 and XP is simply because there was no provision for device classes; well, that's a lie... there was, but the only ones at the time were pretty much keyboards and mice- HID devices. Flash drives were pretty much just invented at the time; this is why every company pretty much has to make their own driver; there was no abstraction of a generic "Storage device" class, so it's basically just a USB device.
I believe windows ME fixed this; it is no longer up to the driver to understand the device, but the device's job to understand the driver. (turns out that almost every mass-storage device did this already with draft specs)
the Generic Mass Storage Driver (Come to think of it, I'm not 100% sure it was included in the unofficial SP, I might have downloaded separately) either way, there is one available. (maybe it was
this one?
Now, of course it's not flawless, I've had issues with hot-plugging and sometimes it takes a few tries before I realize that windows 98 doesn't make the beep-boop sound like XP and open explorer myself, but aside from that it has worked quite well for me.
regarding actually getting these onto the target PC, only thing I can think of is to burn a CD-R or split the file onto floppy disks.