Sorry it has taken me so long to report back on this.
I installed QEMU and KQEMU. I was finally able to create a container through vl-qemu. As ueksk8s stated, you put the path for the container file in the "convert" box and then you click on the Create button, then GO.
I then fdisked and formatted the virtual hard drive in the container with a Win 98 SE boot CD I created years ago. Then I attempted to install Win 98SE using the original Upgrade CD.
I ran into lots of problems. Had to reboot the VM numerous times. Then 98SE complained that my code was invalid. Odd--I copied it right off the cardboard sleeve the CD came in. I finally googled and found a list of codes that might work and I used one of them. Strange that the valid code didn't work but the invalid one did. I allocated 256 megs to 98SE and the partition is four gigs.
I actually installed about three times because my first attempt seemed corrupt, had problems with the second one, and finally the installation seemed to complete the third time. I discovered that kqemu caused all sorts of problems, so I rmmod kqemu and things seem better. It was actually slower with kqemu.
I'm finding that Win 98SE is basically unusable in this QEMU vm. Most of the time it won't even load and if it does and I use it a little, it causes problems and locks up and disables the mouse in both virtual Windows and in XFce. I have to start another console through Control-Alt-F2 and kill the qemu process in order to get back the desktop, but the mouse doesn't work, so I have to exit XFce and X and restart X.
I then copied a 2 gig Win 95A vm from my other desktop and had somewhat better luck with that. It was pretty slow, though. I was trying this on my slower desktop (1.3 GHz, 1 gig RAM) and I think the computer lacks enough power for running a virtual machine acceptably.
I'll be trying both 98SE and 95A under QEMU on my Athlon 64 X2 desktop. Things should be better there. Will report the results, and especially whether kqemu works on that computer.
For my purposes (just a couple of Windows programs, but they're "must haves"), Win 95A is sufficient. It's *really* old, though, whereas 98SE still has a bit of support as far as current programs that'll run on it.