PCIe is designed to be backwards-compatible with PCI as far as software goes. The basic configuration space is identical, so any system that knows how to talk to PCI can talk to PCIe; however, it will not be able to interpret any of the extended PCIe-specific configuration space features, if these exist.
Usually when people say that PCIe GPUs don't work with Windows 98, they mean that there are no drivers. So the GPU can work but only in 'basic VGA' mode, with a very limited feature set. Now, if some specific modern GPU has some mandatory configuration that's only accessible via the extended PCIe space, and the GPU does not work at all without it, then it will be completely unusable under Win9x; however, I don't think this is the case.
DOS is a different thing altogether, because it doesn't even know PCI or anything. The only reason modern video cards work with DOS is because they still supply the basic legacy BIOS hooks that DOS uses; PCI/PCIe devices that work with DOS only work because someone wrote a special 'driver' that allows accessing the device's configuration via alternate interfaces (standard BIOS interrupts, I/O, DMA...)
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