Uh, win98 is a bit picky about IP's, actually. The HOST PC (the one the modem is in /connected to) must have an IP of 192.168.0.1. Then the CLIENT PC's (the ones you are shring the internet to) can have IPs' in the range 192.168.0.x up to 254 - but not 1 (as that's the HOST. Not a spicky at winXP, but picky enough.
So what IP's have ya got, BC?
BTW, I'd suggest not using winICS and using AnalogX Proxy. More robust.
Cheers
Mick