They should be fully compatible, and they are with me for sure (like Office 2000 is compatible with Windows 98, and Office 97 is compatible with Windows 95 also). In fact, when Windows 98 came on the market, Office 97 was the most recent version.
I really don't know what's wrong with you. The only things I can advise are: run repair from Office setup, and scan for viruses with housecall.antivirus.com.
Hope this helps.
I also installed office 97 onto my computer thats running win98se...seemed okay but after installation I tried to use some of its programs ....click..they start (load) but no buttons work...and they wont cancel, have to use cntrl alt del to exit program ....are they compatable? if so whats wrong