Could use TweakUI to hide icons from the control panel. That was found in one of the directorys on an original Win98 CD (directory was powertoy, under admin I believe), and can install and work properly on either 98 or 98SE.
The policy editor might also do the trick, that's found on any Win98 or Win98SE CD, you'll have to search the directories of the CD for the file poledit.exe (or something very similar in spelling), this gives you many options for restricting access to various parts of 98.
I don't know how well these work out as I've never had the need to restrict access from users yet, but it's free and it's certainly a start.