I dual boot a 98/xp box and a 98/win2k with no help from boot magic or anything else. My procedure is to partition the drive into two partitions, setting it up so the first partition is set to primary/active then install 98. After that is installed, then I install win2k/xp on the second, logical, partition. The win2k/xp install recognizes the existing 98 install and automatically sets up a dual boot.
On a side note, I used to have a drive partitioned in three parts, and setup to boot C: 6.22 dos, D: win 3.1, and E: win95. Again without boot managers. So unless something has changed, you could probably tell win98 to be on any partition you wanted.