Hi,
If you were using a current/recent redhat version you would install the 'telnet-server' rpm (not only 'telnet' - thats just the client s/w). After that you have to set it as not disabled under the xinetd daemon (as root) :
/sbin/chkconfig telnet on
Then you may have to configure the linux firewall (all depends on version) to allow telnet through on port 23. Again, if it were redhat 7.x, you would do (as root) the command '/usr/sbin/lokkit' and either allow telnet or set your lan interface as 'trusted'.
Once thats been done you should be able to telnet into the linux box from win98. Remember, however, that the security permissions do not allow you to login via telnet as root. You have to login as a regular user and use the 'su' command if you want to do root stuff.
If that doesn't work because you are using another linux give some more details - one of the problems is that there are variations in the way you achieve the same thing between distros so its not always easy giving definitive answers.
Hope this helps