Hey, I just installed Mandrake 9.0 about an hour ago for the first time. Similar setup, win98/FAT32 partitions on primary harddrive, small secondary for Mdk.
Worked almost perfectly. Set the BIOS to boot from cd, stuck in cd 1, saved BIOS settings and rebooted. All went well, then custom selected the hard drive, formatted the secondary to ext3 and set up 3,4 and 13gig partitions for /, swap and /usr iirc.
Didn't manage to get even an option about bootloader. Lilo ended up being installed.
A few problems encountered about changing cd, but I'll post my own topic in a sec.
Only real problem now seems to be that windows has a different letter asigned to the old F: partition, where most things were installed.