Right here goes.
Firstly start with a blank, empty hard disk.
If your hard drive is, say 20 gigs in size, then from your Win 98 boot floppy run fdisk, and forst create your primary partiton, and tell it to use 10 gigs.
Once you've done that, create an extended partiton, in basically the same way as above.
Format both partitons.
Install WIndows 98, then install WIndows XP, to the other partition.
OR you could use Partition Magic, make anothe rpartiton on your HDD and then install XP that way, thus also creating a dual boot.