I used to have 98 on a HDD, was just a DMA mode 4 quantum of around 500MB, but man was it a lot faster than even fastest CD drives, cut install time to a quarter, would be to the desktop setup while a CD drive was still weeeeepwooooopweeeeepwooooping it's way through "copying files needed for installation". Guess it was the seek times more than the straight up transfer speed, though I think that drive managed 15MB/sec or so.
Anyhoo, very do able, but I used to boot a 98 floppy rather than have the 98 install HDD boot the system. Some machines are a bit weird about deciding what disk was C or D, and if it changed after reboot, win98 setup would get confused. That's with using a 2 drive method, C drive you want to install on and D drive with the 98 setup files.
edit: Oh right, that's why I probably did it off floppy, it was actually faster... otherwise you had to boot the win98 drive, set up the primary drive manually, transfer sys, reboot and maybe go into CMOS Setup to alter drive priority, then boot off the primary as C drive, then install 98 off D. Otherwise it was just boot floppy, C would be actual primary because D didn't boot it, so just setup off D and tell it to prep C and install and it away it went, no messing.
Unicorn herding operations are proceeding, but all the totes of hens teeth and barrels of rocking horse poop give them plenty of hiding spots.