Boot from the 2 OS/2 disks and exit to a command prompt and rin fdisk. Create a Boot Manager Partition (it will create a primary partition about 1GB). Create a partition for Win98 (Primary) and set it to bootable and set the boot manager partition to startable. Reboot the PC with a Win98 Boot disk and run fdisk from there and remove and recreate the win98 partition (unless the one already created is under 2GB then skip this one) and reboot. Format the C: Drive so Win98 can install. Install Win98se to completion. Install OS/2 using the advanced install and set up a Primary Parition for OS/2 and that both the Win98 and OS/2 partitions are listed as startable and the Boot Manager partition is listed as bootable. Reboot and continue the OS/2 installation.
If you run into any problems with the above instructions, I have used OS/2 since the OS/2 2.0 beta days (before the Workplace Shell) and can help you out as necessary with it, email me... I will be happy to help...
Just out of curiosity, what are you doing with OS/2???