the specs you would run Win2k nicely, possibly WinXP too. I suggest you create a 2nd partition, put Win2k on that and see how everything runs. If it runs well, then simply ditch the 98se partition, and expand Win2k to the full extent of the disk.
You'll want a program like PQMAGIC for this of course
Athlon64 3200 Clawhammer / Asus K8N-E Deluxe / 1GB Crucial DDR400 / Geforce 6600GT 128MB AGP / Windows XP Pro