I have SP2 installed and I NEVER had problems with ANY game after installing the upgrade. In fact, I get the impression that WinXP is running a little faster with SP2 installed.
This is no bull****, I play games A LOT. When a game crashes, it means that a crack is poorly coded or the copy protection is too damn hard to break... or a bug in the game.
But I think that Win98SE is way better to play games than WinXP... if only Win98 had support for 1GB of RAM