That's all I ever used back in the day when I ran Win98. I ran it on a Toshiba PII-300 and a Dell PIII-600 notebook. It's the only way to go, as far as I'm concerned. There's something about getting rid of all the intgrated IE crap that makes 98lite more stable. Even if you want to use IE, just install it later as "stand-alone". It's getiing rid of the tight integration that's the secret. It also saves a lot of room on your HDD, depending how you have it configured.
Two big "Thumbs Up" from me. 98lite rocks. I turned on a lot of friends and family to it also. All their boxes ended up more stable. My sister and aunt are still running it, even after 3 years.