Check the setting where its trying to copy the drivers from, it usually defaults to your C:\ drive not the CD\ROM drive. Also I found it simpler to load the drivers through the Device Manager in 98\SE. Just click on update driver and select browse, then open the appropriate folder on the drivers CD. Let me know if you have further problems and we'll find a way to get you running. Remember that you need to installl the USB2 drivers and the Audio Hotfix if you're using 98\SE, these are located on the driver CD but don't install automatically, you have to open the folder and start it manually, the folders are marked USB2 & Audio I believe.
Good Luck and keep us posted!
Regards, Balrog