Hehehehe.... At least I found the similar problem with my system lately about restoring good registry then it wipes out everything.. I mean everything out of my hard drive except empty shell of Windows98 with standard VGA video driver, what a bull...crap! Anyhow, the problem with my case, there are some system file that controls and monitors the registry files right before booting windows. They are in the C: drive if you scroll down a little. I deleted "
ALL" except autoexec.bat, Command.com, and Win386.swp

I have never seen that troulbe-making or trouble-creater so-called backing up registry files ever since. The system works perfectly fine and no loss data! hehe.. I gotcha sucker!!!! I blasted em, trashed em, and deleted out of trash can. Ha!!!