Marty Martinez...
Both OS 'can' reside in the same partition - as long as it's FAT32 (some folks have done it without problems...). 'BUT' it is considered wiser/smarter/better to have them in separate partitions... Also to install W2K 'last'.
So, two ways to consider:
A)
Fdisk ('98 boot-disk, enable large disk support) and create a Primary Partition that is FAT32; make it large enough for your '98 OS/applications - how big is upto you, and the size of your HD... (but around 4Gig is usually more than enough...)
Install '98 to the C: system (active primary) partition.
Then install W2K into the Extended partition space. W2K can be FAT32 of NTFS - if you don't 'need' NTFS then leave it as FAT32 for the moment at least - you can always convert it later... (remember - '98 cannot 'see' NTFS...)
Slight variation on the above... 'Ideally' create 'two' logical-drives in the Extended space and install W2K into one of them and use the other for common accessed data (FAT16 or FAT32 - as you prefer...)
B) Another route...
Again Fdisk and this time create a 'smallish' C: system (active primary) partition; this can be either FAT16 or FAT32 - since both OS's can see both FAT's... Make this C: system area around 250Meg (if you have large HD make it nearer 500Meg?). It 'could' allow you useful options in the future, if it's FAT16 (my personal preference) rather than FAT32 - but you might be just as well of with it as FAT32 - the choice is yours...
Create at least two, 'ideally at least three', logical-drives in the Extended space; one for each OS, and one for common accessed files...
Install '98 first into the first logical-drive, then install W2K into one of the other(s).
Going the second route means that both OS boot/start-up files are installed into the Active Primary (C: system partition) - with each respective OS itself in its own 'isolated' logical-drive. This is the standard/M$ route for dual/multi-boot NT/'9x, W2K/NT, W2K/'9x etc...
The benefit of this is that it allows you to re-install either OS in the future (even to reformat its logical-drive) without 'upsetting the other OS...; or damaging your data area; and if you're starting out afresh, then I sugggest it's the better of the two routes to follow...
If you want to practice/use NTFS issues, then create a fourth logical-drive in the Extended space at the start, and use this for NTFS issues???
Either way you end up with the dual-boot option.
The above suggestions are not the 'only' way to go... Possibly other folks will suggest additional ways to set it up?
If you like to do a little reading...
visit: http://www.winmag2000.com
and locate the Back Issues section (top right of menu bar on the home page) and read through the Summer 2000 edition. It contains much useful discussion etc. on installing W2K in several scenarios.
Not sure about Fdisk? There are excellent 'How to's' here at Computing.net; and the M$ version is at M$ KB: Q255867
(Incidentally, I think it's usually better to post your own query separately, rather than tag it onto someone else's - likely to get more responses...?)
Good luck...