ok my sollution but could be expensive:
try to get an external/internal laptop hd combo, one you can put in your laptop and use as external hd.
The new hd should have a clean Win98 installation, nothing more, same size if possible, and if neccesary same partitions. Switch the 2 hardrives with eachother, boot with the new hd, and connect your hd wich is no in the external casing (drivers needed). The FAT32 system (win98) could be able to read the data, copy the data to a NTFS partition with enough space offcourse or on the new hd.
OR:
but more risky and less chance for succes is to convert or install a new fat partition, install win98 multiboot and try to recover the files. but only if he can afford to lose another partition with not that vital data.