Hi everybody.
I found this post from 'www.annoyances.org'. Credit goes to who posted, Lenice Y.
Maybe this is the right/best solution. I don't have a win98 computer anymore, so I can't test it.
So, Bhavbhuti , let us know if it solves the problem:

"I just had the same problem and fixed it... Head to My Network Places on your XP machine. Click the common task "View Network Connections" then double-click your LAN connection. Go to Properties, then highlight the TCP/IP protocol and hit the Properties button. From there, go to the Advanced button under the General tab, and then to WINS. Choose to Enable Netbios under TCP/IP. Apply, close, close, close, etc. All of my shared devices and folders popped right back up after this! Make sure you've allowed an "Exception" for Windows file and printer sharing if you're running a firewall or XP service pack 2."


>>Hi all
>>
>>In a setup between computers, Win XP Prof., W2K Prof. and W98. The W2K and W98 machine are sharing folder nicely. The Win XP can access the other 2 shares but they are not able to access the Win XP shares.
>>
>>I have tried to create same named users on the Win XP machine (that was the trick between W2K and W98) but the sharing is still one XP way.
>>
>>Internet is too shared from the XP machine and that is available on the W2K machine and for this to happen Win XP needed a fixed internal IP but not the other 2 else the Internet sharing stopped.
>
>Sounds like the firewall on the XP machine is set to prevent incoming file-sharing requests. You can test this by temporarily disabling the firewall on the XP machine.
>
>If you're using an antivirus package that has its own firewall, try disabling that firewall. For example, clients of mine have had a lot of trouble with the Norton/Symantec firewall in the 2008 and earlier products.