I have used win98 in a networked enviroment and noticed only that it would freeze if the PC was left idle for some time.I just either left a window open or enabled screne saver to solve this instead of searching for problem. other than that I believe It should work and does ,your problem must lie elsewhere. When do you notice it freezing when idle? or using certain programs?
Dare I say I have had cable broadband for over two years on Win98se using usb, without any adverse affects. (No more blue screens than before and none because of cable broadband) Twelve months ago I wire networked to a laptop running win xp using a pci network card in the desktop & on board lan connection in the laptop. All ok, laptop connects to internet with shared internet connection. I can access the laptop from the pc & vice versa I use the printer attached to the pc from the laptop.
I would say that the problem is hardware based not the operating system.