Memory's a bit dim now, but is Win98 installed at the moment. If so just choose to restart in dos and type format c:
If not boot with the floppy and when you get to the A:> prompt again type format c:
As I recall Win98 creates a temporary ram drive which pushes the CD drive down one letter until the install is complete. So if the CD drive is D insert the CD and type E:\setup.
If I've forgotten anything no doubt someone will say so.