Not sure why this is happening. Last time I used win98 was over 5 years ago if I'm not mistaken. Not sure if the windows folder includes your desktop and documents. Try to check if there are any files you downloaded/copied there.
Win98 would only use something like 100-150 mb the most.
I don't think there is a firewall installed in your router. It should allow you to mess around with ports and stuff but has no firewall.
Get on to your ISP's support phone line and get them to run tests on your connection to see if it works ok.
open "my computer" and then the C drive or whichever drive you have windows installed. Right click - properties on the windows folder (could be win98) and post the size it shows in the properties window, so we can see what is the size of the operating system files.
I would definitely disagree with this. For windows based systems I think the McAfee antivirus solution is far greater. Have only used the enterprise edition though, which is very light. This was in my previous job which was installed to over 20 workstations connected to the Internet and never...
If you have a windows 98/MS DOS disc you could start the computer with cdrom support and run fdisk after boot. From there you should be able to see the partitions available and delete/resize/create partitions.
If you still cannot create a partition, there must be a failure with your hard drive...
Try removing all hard drives/memory sticks/sound cards/etc. and then try to boot with only a graphics card and a single memory stick.
If this doesn't work, you have a hardware failure either on the memory or on the mainboard.