Dave....go for the 98 SE......the Millenium Edition version was a hotch potch and has a lot of flaws.....but 98 is pretty well sorted and far better supported in terms of drivers etc.
Plus you don't have to back-up...though I would for sure.....I'm not certain about going to ME but as a lot more different (sort of half way between NT and Windoze) it's far more likely that you'll lose stuff.
Open up the search window, then search for all your documents so you can copy them to disk...for example, for a word document (.doc) search for *.doc (the star denotes anything can come before the dot)....then if you want copies of your emails there should be an 'export' option somewhere depending on what Email client you're using......
Also remember your desktop settings and whatever piccy you're using...and write down your e-mail settings, passwords, the IP address, and copy or export your 'favourites' from IE so you dont have to look up all those juicy porn sites afresh.
If i were you, I'd start from a fresh loadup......IE format the hard drive and start from there.....there will be a lot of crap built up and you'll be surprised how much quicker it'll al run from a fresh install...i do this as a matter of course even using XP....there is always a noticeable increase in speed even though i use all sorts of stuff to keep my system clean.
If yu need any help on reformatting, post here 'cos lots of us will know, or feel free to PM me.
HTH
Bill