That would be a really neat trick since Windows 98 did not come with USB support - you had to add it after install. And most versions of Windows 95 don't support USB at all.
https://support.microsoft.com/en-us/kb/253756
A quick Google search turned up this site. Apparently it can be done, but as expected the procedure is far from trivial.
http://www.rmprepusb.com/tutorials/117
As you're going to need a CD-ROM drive to convert the install CD to an ISO, it might be easier just to borrow your friend's CD-ROM drive instead (provided you can find an IDE one).