You don’t mention if you have a Domain controller or not, but the first thing I’d wonder about is the authentication being used for the Win98 clients. If they are logging in (drive mapping actually) to the file server as work group members, this may be the problem.
Try doing the drive mapping after configuring the Win98 clients to authenticate against a domain controller.
Another possibility is that the file systems permissions are not allowing use of the drive, even though the share-level permissions are.
The information you’ve provided isn’t enough to go on.
Please write back with more details of how the logon, sharing, file permissions, etc. are set up.