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I don't have any particular recommendations for W98SE USB radios. I've used DLink DWL-G120 and DWL-122 USB radios without much difficult on Windoze ME laptops.
I agree with your comments about the WUSB54G software and drivers. I've experienced the monitor and driver crashes. However, I find that the few other USB devices that I've tried, do much the same thing. However, I can offer a clue. I had Netgear WG111 that was driving me nuts on an old Dell something laptop running Windoze 98SE. It had a USB 1.1 port so the WG111 was running at 802.11b speeds. Just for fun, I shoved in a PCMCIA USB 2.0 card and installed the WG111 there. No lockups, no crashes, and everything worked as expected.
I also had a similar experience with trying to run the wireless card through a USB 2.0 hub on a different machine. This was a W2K IBM A31 laptop with a DWL-G120 radio. Totally unreliable. Initial connections often claimed that it couldn't get a DHCP address. If I managed to connect, it would eventually hang or disconnect. Removing the USB hub solved the problem. However, the IBM MiniPCI wireless card arrived a few days later, and I didn't have time to do additional testing.
Now, back to the original problem. Have you considered going to fiber optic lightning isolation? 100baseTX to 100baseFX Fiber optic media converters are not that expensive and far more reliable than wireless. If you can live with 10Mbits/sec, the older 10baseTX devices are really cheap. Many ethernet switches have plug in modules for fiber. How's $12/ea for 10baseT to 10baseFX: