See the other thread on dual-booting. Also, DOS6 only understands FAT16 partitions but a Win98 boot disk would also let you run DOS games on a FAT32 partition.
If your C: drive is NTFS you could use Partition Magic to shrink it a little and make a FAT16 or FAT32 drive with the extra space, but back up your system first!
For setting up a new system you could use Partition Magic to make 2 C: drives (DOS6 first then XP) and use BootMagic to choose between them.
[ ed ] you could also pick up a 486 or Pentium 1 box for under $100 and add a KVM switch to share the monitor. This would give you better sound quality (using a real ISA card soundblaster or next best choice a Vortex2 card) and solve some of the speed problems from running a 486-era game on a GHz PC.