OK just get FACTS straight.
Windows XP is capable of reading FAT, FAT16, FAT32 and NTFS file structures.
So if one attaches the HDD of a Windows 98 system disk via external case or
otherwise, without the exeptional problems caused by interface / drivers etc,
it can be ACCESSED by another system running XP.
All files can be read, using the term file to represent any single item of
data stored: the problem comes with interpreting the data. If there isn't an
application able to interpret the file, then it won't OPEN as such.
So if you have a MS Word 98 document [filename.doc] on that external disk
and you have MS Word 2003 on the XP system, the file will be OPENED in MS
Word 2003, as it has the appropriate code to translate the file.
If there is an executable file [filename.exe or filename.dll] it may or not
be OPENED or RUN under XP. COnsider that in themajority of cases it will not
be run under XP. For an .exe file to be OPENED XP must have the appropriate
entries in registry. Given that an application, when installed, creates
these entries [for all its executable modules, and there may be hundreds of
..exe and .dll for any given application] then unless you have it on the XP
machine, it won't run. However why bother opening an .exe file from the 98
disk when the application is installed in XP.
Also some earlier versions of an applcation may not be compatible with XP
and need to have the XP version installed.
So if you need an application which is not on your XP system, it needs to be
installed before opening any unique files associated with that application.
For eample, if you have Quickbooks on the 98 System and not on the XP system,
you won't be able to OPEN any Quickbooks files, nor will it work by
attempting to open a Quickbooks .exe file.
Hope this clarifies the file structure and file type situation.