|That error is from an attempted/incomplete Win2K or XP install. The fact that the error is coming up is confirmation that the machine is seeing the hard disk.|
I would boot with a 98SE bootdisk*, use fdisk to remove all partitions (DOS and NON-DOS) and create new, make active, reboot and format, then start the 98 install.
If you have trouble deleting any NON-DOS partitions, you can use delpart to remove them.
Post back if you have any problems.
The above bootdisk image file is a self extracting file and has to be executed (run) from a running Windows machine in order to create the actual startup diskette. (This image file produces the same bootdisk which 98SE creates.) This downloaded image file will format the floppy disk, write the files to the disk, then verify the file write, so it'll take a minute or three to create the bootdisk.
Ensure the floppy drive is set as the first boot device in the bios. http://www.d-a-l.com/articles/library/23.html
When you boot a machine with this boot floppy, it creates a RAMDRIVE in system memory to contain DOS system tools. Thus it will move your "normal" CDROM device/drive letter "up" one level. (If your CDROM is normally E:, it will be F: when booting with this bootdisk.) The path to the found CDROM will be set with the bootfiles however, so entering A:\>f:\setup is the same as entering A:\>setup at the A:\> prompt. There is no need to include the cdrom drive letter. The CDROM device letter will be assigned near the end of the floppy boot process, right after MSCDEX is loaded.
It's a good day when you learn something