Your best bet is to just install Windows and have a Dos Boot disk for your games, and to get to the command prompt to fix problems. This way you get around the Fat16 partition size limit, and you can always use the dos boot disk to take care of any problems...
If you go this route, you'll need to use Win9x's version of FDISK, say "Yes" to large drive support" when prompted, remove all existing partitions, create 1 (one) new Primary partition.
With this scenario, install Win9x, make a setup disk (boot disk), etc.
Remember, you can always hit the F8 key when Windows starts to choose to boot right to the command prompt. You can also have the boot menu appear at every boot up by editing the Win9x's version of "msdos.sys" (it's read-only, so remove that attribute first), and edit the line "BootMenu=" and set it to "1" (no quotes). This way the Win9x boot menu will always come up and you can choose to boot normally or right to the dos prompt.
Remember, too, that msdos has no support for Long File Names in windows, so you can totally hose a system manipulating files that way.