Hmm, bunker monkeys suggestion might work. What type of program are you using to "ghost" the hard drive? Some programs only ghost data , not system files, etc. Also, If you already have XP installed, ouch, you may need some sort of boot manager. Usually, and I know you probably didnt anticipate this, you install 98 first, then XP, and windows will install a windows boot manager. But if you just install Win98 from a boot disk ( boot to floppy, then install using win98 cd) it will always boot into the win98 partition with no option to go with the xp partition.
Also, another thing to consider, if you have NTFS and Fat32 disks, win98 wont recognize partitions/drives formatted in NTFS. Do you perchance have PowerQuest partition magic? It has a boot loader , but I have never used it. It also shows the option to install another os, which may work around your XP "downgrade" prob. And it will convert Fat32 to NTFS, etc, BUT you may have some data corrupted in the transformation.
Edit : just out of curiousity did you google new (XP) drivers for the camera? Or possibly try a generic removable storage device driver? Be careful using Driverguide.com as it will infect spyware into your system. Try Kodaks website, etc.