Yeah it's a disk format issue. Same thing happens when I start installation off CD on my Latitude CPi.

I always installed off my hard drive because my first 98 system actually didn’t have the correct cdrom driver on the boot disk so I just copied the folder off the cd to the hd

Anytime you can install from media other than optical or floppy, it's usually faster. You should be able to drop that \WIN98 directory from the CD onto the hard drive (preferably a 2nd drive on another IDE channel) , run setup and not have any issues.

As for the write-to-drive errors, I'd step back and check the hard drive. Run scandisk (or other drive test) and pending the outcome of that, zap it with a fresh table and re-create your FAT32 partition (remember to mark as active/bootable if you don't use an automatic utility). GParted Live or PartedMagic are wonderful at handling the above, but you can use MS-DOS provided tools as well. But yeah, even if the drive passes media test, I'd still start fresh with the drive as a whole and see if your problems go away.

Yes, it was the drive as I said above same thing happened when installing off CD onto the drive from another system. Just a formatting issue, once I reformatted from the setup, I was able to install just fine. I now have drivers installing on said ThinkPad and have also installed the Plus Pack. All working great 😀
Even the ThinkPad's CD-ROM drive managed to make it through the 98 Plus! installer, although it does sound like it's struggling trying to read my 98 SE burned disk to install some drivers. It's doing it, but doesn't sound good. I definitely think the laser is failing.

If it's a standard-ish IDE laptop drive (even behind the brackets/adapters), those drives are usually less than 10 bucks. From what I recall, the StinkPads used pretty standard components. Probably could even swap-in a IDE DVD drive for an upgrade!

I’m not 100% sure on that - it uses a stacked cd/floppy drive which I’m pretty sure is one unit. I’ll have to double check if I could install a standard drive in there. Biggest issue there though would be transferring the bezel, if that’s even possible. The drive does sort of work so I’m not too bothered right now, but it would certainly be nice to install something 100% reliable.

I've done that sort of swap temporarily before on a Pentium III VAIO that I needed to reinstall Windows on, OEM drive was dead as a doornail so I had to temp-swap in the drive out of my Inspiron 8100.

As for HOW:

Cook up a dos networking stack on a boot floppy. All the support goodies should fit, if you are minimalistic on everything else. (basically command.com, io.sys, msdos.sys, himem.sys, emm386.exe, net.exe and pals)

Once you have that up and working, use it to connect to a windows share that has the files you need. Copy them into a folder on your system's drive, then boot without the floppy (the installer does not like to share memory, and will get suwin errors) and run the installer.

cake.

I like the network idea and has been on my todo list for a while now.
Until then though (and probably after) I always create a partition with the Win98 folder from the CD and at the very least drivers to get network up and running but if you have the space rest of the drivers, apps as well

The networking approach to things keeps coming up in discussions, I should really learn more about how to actually do that stuff. I've always been TERRIBLE at anything to do with network configuration.
This ThinkPad also has no networking built in - unless you're talking DCC over Serial or Parallel, which I already use (LapLink over parallel). I have plenty of PCMCIA modems and ethernet cards though.

For now though, everything is set up and working.