nonsense. this should work just fine, i have two machines where i have the exact setup you described, one with 2000 server and one with 2000 pro, both also have XP, and both have them on separate drives. when you installed XP it should have added a line to the boot menu for 98... do some more research, you may just have to edit the bootmenu and/or fdisk your MBR
FWIW you can't load linux with the windows bootmenu, you have to use loadlin or lilo. windows bootmenu will only work with M$ OSes.