If you've decided on dual-booting with WinME and Win2k, then what you're suggesting is fine. Remember: WinME has to be installed first, and your partitions will have to be FAT32 if you're installing a 5th partition with shared files. Those files have nothing to do with apps installed in either OS. Usually, mp3's, etc. would go on that partition.
Yes, you'll have to partition your hd, and you will have to install drivers on each primary partition. The 4in1 drivers are the same. Drivers for other hardware might differ with each OS depending on what hardware you have - check to make sure.
The first two drives (your primary drives with the OS') will be your C drive - one active, one hidden. The next 3 drives will have the next sequential drive letters assigned to them.
I know you said you don't want to spend the money, but Partition Magic is a great program and worth it. Believe me, it'll be a breeze to set up your partitions with PM and it will also map your drives the way you want. Boot Magic is included - make sure you make the recovery disk because, if your boot record goes awry, you'll be able to boot up off of it into either OS.