Both of my retro machines use an M-ATX board.
Since you mentioned Win98 a bunch - for my Win98/XP rig, I use an Asus P4P800-VM (S478) with a P4 3.0c (or 2.0a depending what config I feel like). It's got a 4x/8x slot in it and paired with either a GF4 Ti4200 or an Ati x850 Pro depending on config. For Win98SE compatibility, it runs like a charm - zero issues due to the 865PE chipset. Onboard LAN is an intel pro100 so decent enough, sound is hot garbage though so I'd be prepared to shell out for a sound card of some sort. Caps are known to leak (as with many boards of this era due to the 'plague') but easy to replace if you have the knowledge. One thing I do like about this board, it has 2 SATA 1 ports and is able to run it in 'IDE compatibility mode' which works decently well in 98, so you can use (SOME) modern drives without needing a cheap converter. Be aware that many of the newest drives are dropping support for SATA 1.
For a 98SE highly compatible rig, I would highly recommend this board with:
- GPU wise, a GF4 Ti card or 9800 Pro (both can be found with a reasonable price and has tons of performance). With a higher clocked S478 CPU and a 2002-2003 era GPU like that, you'll be able to run just about everything that 98SE has to offer and even quite a bit beyond. GF4 will give you better support for pre DX5/DX5 titles while 9700/9800 Pro will give you more performance, especially on the higher end.
- CPUs are dirt cheap everywhere so take your pick with how fast you want to go. I initially had a 2.0A which I find more compatible and more 'in tune' with 98, but later on got a 3.0c which works out far better even with the HT on (Win98 doesnt make use of it but I keep it on anyways for XP).
- RAM is also dirt cheap. 512mb max for 98se but you can get more if you use rloew's PATCHMEM. I use 2GB in my system as I'm dual booting with XP. To make it work with 98, install 98se as normal, when it crashes after first boot - start back into a boot disk with PATCHMEM on it. Copy it to the C drive root, run it, then reboot and it will continue on as normal.
- For sound, I went with an Audigy 2 ZS installing the VXD drivers which works pretty well. There are a lot of decent PCI options though with SB Live (non OEM) or an A3D card.
- For storage, take your pick. A 120GB SSD will work just fine (providing it has SATA1 support) and runs without patching needed. I just opted for a newer fast HD (320GB) and partitioned off 80gb for 98 and the rest for XP. It's fast enough that damn near everything is instantaneous anyways and no worries about TRIM. Any drive past 2004-2005 will be super fast for 98 anyways.
- For a power supply, I would pick a modern one with at least 130 watts on the combined 5v + 3.3v rails at minimum. Even with the P4 CPU header, many things like your video card and drives still heavily use those rails.
If you decide on an Athlon XP system instead, you should be aware of it's extremely high 5v + 3.3v requirements which makes sourcing a good working power supply very difficult. Athlon and Pentium 3 are in a similar boat although not as bad. For this reason, I usually recommend Pentium 4 for building a 'new' 98SE rig since you can use modern supplies with them.
As a note - for the DOS/Win95 rig, I use an Asus P5-99VM (SS7). It doesn't have AGP but it's 'only' paired with a 200MMX. Has a S3 Trio64V2/DX and a Voodoo 1. For Win98SE compatibility, I did try this once with a K6-2+ 550 but due to not having an AGP slot - gaming performance was pretty limited. However, for DOS it doesn't matter any and early Win95 (pre DX5 stuff) it runs pretty great. You get all the modern conveniences like ATX layout/power support, no dallas/varta battery bullshit, all while being able to drop down to early Pentium performance and even beyond with utilities like SETMUL. Does come with a SIS530 video integrated (connected via AGP) which is ok for DOS compatibility and a Creative AudioPCI for onboard sound (some boards omit this). Both can be completely disabled via jumper so it doesn't take any resources.
Hope this helps!