First of all, you should be making your images (burn and write) using the "Ghost Boot Disk" method. Starting the PC with the Ghost floppy in the A:\ drive. When you create an image, you first need to chose the source(your Win98 install) then it asks you for the destination the empty drive or partition).
Once you have the .GHO image of your OS saved, this is now considered the source. In your case your source file is where the .GHO is located, then your destination will be the newly formatted empty drive. Essentially it's the opposite of creating an image...