You need sharing installed and at least one resource (drive, folder, printer) shared on any Win98 machine you want to be 'visible' on your network.
The filestore type (FAT, FAT32, NTFS etc) on the various machines DOES NOT MATTER (eg, XP machine on NTFS 3.1, NT machine on NTFS 3.0, Win98 on FAT32 and Win95 on FAT will all be able to access each others filestore if networked correctly).