Windows 98 in Xen

I should have this cross-posted on the Win98 and Linux forums
I'm trying to install Windows 98 on a client's server and it's freezing at the "Please wait while Setup initializes..." screen after it formats.

The machine has a unique setup: originally a HP Pavilion m7780n
Intel Core 2 Duo E6400 2.13 GHz
2GB DDR2 RAM
2 x 250Gb SATA
DVD-RW
HD-DVD Rom
bells, whistles, etc..

It's running Fedora 8 Xen kernel (2.6.21-2957-fc8xen)
So what I'm actually doing is setting it up as a vitual machine
It completes the format of what it considers it's "C:" and goes to initialize the setup and then nothing. I give it about a half hour and then shutdown the VM console and reboot.

The Windows XP VM install went without a hitch.

Any clues?