1.Using another PC, boot into a 98SE bootdisk with CD-ROM drivers - FreeDOS is quite picky with 98SE's installer - I've had issues with it on three diferent retro machines (P3 650, P2 400 and AMD K6-2 500) where it would get stuck at "preparing setup files" with a "INSERT DISK IN DRIVE A" text at the upper left corner, hence why I strongly recommend using a 98SE bootdisk (CD or floppy, your choice) for doing the first steps (partitioning, formatting and copying the files on the drive)
2.Partition the drive with FDISK and format it with format C:
3. After formatting, type in "sys C:" to install a small copy of the 98SE DOS present on the CD, then move to C: , and type in md WIN98.
4.While still on the 98SE bootdisk DOS prompt, eject your bootdisk and insert the 98SE install CD
5.Swap the drive to your CD-ROM, and type CD WIN98 (this is assuming you use a copy of a genuine Windows 98 SE disc.)
6.Type "copy *.* C:\WIN98" and wait for the 98SE installation files to be copied to the directory you have created.
7.Finally, reinstall the HDD on the thin client PC. You should be getting a DOS prompt reading "Microsoft Windows 98 (C)Copyright Microsoft Corp 1981-1999" and a C:\> prompt afterwards.
From step 7 onwards, it's just CD WIN98 then running setup.exe from there.
"Enter at your own peril, past the bolted door..."
Main PC: i5 3470, GB B75M-D3H, 16GB RAM, 2x1TB
98SE : P3 650, Soyo SY-6BA+IV, 384MB RAM, 80GB