I first would look into the bios and see if you can change the boot order to a external device. You may have to change a setting to where the bios can see the external cdrom drive also.
Beyond that this is the easist method i've found. From another forum that i copied to a text file.
Use another PC.
Go to www.bootdisk.com and get the file to make a boot-floppy for W98-SE. Create the floppy by running this program.
You can buy 2.5"-3.5" adapters. Take the laptop-hd out, connect it temporarily to this other PC as Master and disconnect any other HDs. Using the boot floppy you made make 2 partitions on the Laptop HD , the first one of max. 30GB (and set it active). Format this in FAT32 using format C: /s /u, the second partition uses the rest of the HD, format also in FAT32. Remove the floppy and try to boot that PC. It should boot into C:.
Now connect the original PC-HD back on, and make that laptop-HD the slave. Boot up.
Then copy the full contents of the XP-CD to the SECOND partition of the laptop-HD.
Take the laptop-HD out, set jumpers back to master and put it back in the laptop.
It should boot the laptop into C:. Then go to the laptop's second partition and start XP installation from there (setup.exe most likely). Let XP re-format the C-partition as NTFS. Keep the second partition with XP-files for when you need to (re-)install, and store your updates and other stuff there.
SRX660