Yes, Ghost is an excellent program for creating a backup. If used properly, it will restore you system and you will not need to reinstall all your programs. However, it will return your system to your current dilemma with IE all messed up. So this is not a good option for you currently.
I'm still not convinced that its just IE that's messing you up though. I think your best solution is backup any important data,
completely reformat your drive, and reinstall Win98.
BTW, when you were forced to reinstall Win98 was it clean?
If you do reinstall Win98, I suggest a LLF (low level format) of
your hard drive first. The reason why (if you didn't know) is that on a standard reformat your old data is still on the drive in one form or another. Windows reformat only overwrites part of the file so that it is not seen. Normally this is not a problem, but ocassionally Windows will see this old data causing you problems in Windows. The best LLF program to use is the one that came with the drive. If you don't have it, check out your drive manufacturer on the Net.