I'd wipe the HDD with an application like Killdisk. Writes zeros to the drive, essentially making it "like new". Here's a post from another thread:
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Killdisk is a nice free program that is not hard drive brand-specific; it'll work on all hard drives.
You can go to bootdisk.com to D/L a win98 boot disk and then copy the Killdisk program to it. Then boot up to dos, navigate to the floppy drive (probally will be "B:\" drive), type in "killdisk.exe" and follow the instructions. When in dos, navigate to the B drive and type in dir/w. If killdisk is listed there, you're in the right place to type the "killdisk.exe".
I apologize if I'm going into too much detail, but if you don't work much with dos it can be a little confusing.
Links:
http://bootdisk.com/bootdisk.htm and click win98 OEM
http://killdisk.com/downloadfree.htm
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Also, I'd make sure your HDD is properly cabled, with the right jumper setting. Good luck.