Windows 98 wont let me wipe hard drive?

Instead of trying to format the disk run FDISK from the command prompt and delete all the hard drive's partitions, you'll have to reboot after this to make the change permanent. Have you tried wiping the drive through the Windows setup program that it automatically runs? You shouldn't need to use the command prompt first to do this. If all else fails, download and burn a live Linux CD and use that instead.