You might want to take a screenshot of Disk Management just to make things a little bit easier to understand how your setup is...
why don't you edit the the boot.ini files to make the Xp the default system? It would just be a matter of setting the default boot, than you could migrate all of the 98 settings over
for a different purpose but you would be able to use this same program to perform the shrinking and expanding portions. I had never used this (I use the commercial product Acronis Disk Director) but taking a look at it's screenshots it looks useable.free - parted magic