So xp will go on the new computer not the one with 98 on it right now, correct?
Get a full version of windows and install it as an upgrade on the 98 computer. Convert the disks to ntfs and then burn them. Once new computer is built you can reformat the old 98/xp computer, reinstall 98 on it and then install xp on the new computer. This will keep you legal, if it matters to you.