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Make sure that your USB port is working. Right click on My Computer and select Properties then click on Device Manager and you should not see any yellow exclamation points (note that you should have your flash drive plugged in). If you do see yellow exclamation points then click on it and Remover it. Then restart your computer after you have removed all exclamation points. Windows should then reinstall the driver correctly. You should check this once you restart. If you still have troubles, it may be because windows require a specific driver for this.

The flash drive itself probably doesn't have any software but you might want to check the manufactures website as there may be known issues when plugging it in to a win98 machine. Some Flash drives have a slide switch that makes them write protected. You might want to check for one on yours. If that's not the issue, I would go to the manufacturer's web site. Different drives have different features. You may need to download a utility to reformat it. Flash drives usually work with Windows XP right out of the box. For Windows 98, you usually need to install drivers for the particular drive that you have.

If you go to the flash drive manufacturer's web site, they will more than likely have drivers for Win. 98. What I do is remove the hard drive from the old machine, unplug the CD player on the new machine, and plug the old hard drive into the new CD cable. Then I boot up and copy everything I want to transfer using Win Explorer. A USB flash drive should work fine. Best prices I have seen are at Wal-Mart and they range from $18 for a 128 MB stick to $78 for a 1 GB drive. The only problem is that Windows 98 does not recognize them as plug-and-play and you will have to download a driver for it. XP is automatic.

This does certainly sound like symptoms of Spyware. If you're trying to backup and it's not working you basically have two options: First, you might want to try a USB Stick (Flash Drive) which are roughly $15 USD, $10 GBP and back data up to that. Second you could try an online backup solution such as Carbonate which is only about $50 a year for unlimited data backup.

Once you have backed up your data and you're ready to reinstall Windows: If you have a recovery disk from your manufacturer, or you could go to there web page and see what kind of information that they might have that I was not able to tell you. You could possible email them about the problem that you are having and see what they have to say about what might be wrong or what you might need to change so that you computer will work for you. If you see a number on there web page then you could call them and speak to someone directly and explain the problem to them.