"IE is only broken in XP" uh hu, thats what all the service patches are for...
You've installed each OS on a different drive, correct?
I ask because one of the first things you read when reading up on
dual boot, is to install on seperate drives because of commonly shared
files names and public/private directories.
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Multibooting with Windows XP Introduction http://www.microsoft.com/windowsxp/pro/using/howto/gettingstarted/multiboot.asp
Disk configuration Requirements for multiple operating systems
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Basic disk This is the common name for the hard disk in your computer. You have a basic disk unless you have converted it to dynamic disk. MS-DOS and all Windows-based operating systems can access basic disks. A basic disk can contain up to four primary partitions. A partition is a section of the disk that functions as a separate unit. Each partition can have a different file format and different drive letter, for example, C: and D:. Each operating system must be on a separate partition.
Single dynamic disk If you have one hard disk and you have converted it to dynamic disk, you can install only one operating system. You cannot multiboot.
To determine if you have a dynamic hard disk, click Start, click Control Panel, click Performance and Maintenance, click Administrative Tools.
Double-click Computer Management, and then click Disk Management. In the right pane, your disk will be labeled as a basic or dynamic type.
Multiple dynamic disks If you have two or more hard disks installed in your computer, each dynamic disk can contain one installation of Windows XP Professional, or Windows 2000. No other operating systems can start from a dynamic disk. Windows XP Home Edition does not support dynamic disks.
One OS Per Partition
Before installing Windows XP and an earlier version on the same machine, you must prepare your hard disk with different partitions.
When you install Windows on a new or reformatted hard disk, the Setup program typically does not partition your hard disk automatically. To create multiple partitions, choose Advanced Options during Setup and follow the instructions to create and name multiple partitions. You can also create partitions using Fdisk.
If you have already installed Windows, and you have only one partition, you must reformat and partition your hard drive before you can multiboot.
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If you didn't then it might very well have flubbed your 98 IE with a mix
of the XP-IE files being installed into it's folder...
just a thought....
you might want to go to the update site and run the update again to see if it catches anything amiss. If it does and fixes it, great, if not, nothing lost..