system
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To boot from CD,the bios needs to be set to CD-ROM 1st. Will the computer boot? XP has a “recovery console” see:
www.theeldergeek.com/recovery_console.htm
Try using it to get back into windows.If it wont boot to CD try booting the floppy with a 98 boot disk.You wont be able to "see"the hard drive because DOS is not able to use NTFS but the disk has drivers for CD-rom which you should be able to access the restore disk.I think reformat is the last resort.
-max