Good that you managed to at least get up and running somewhat. Maybe someone else here has some advice on the USB issue, (I never had much luck getting USB and 98SE running well, but I retired from the PC business just before WindowsME was released, a lot may have changed since then...I've never had a lick of trouble with USB on 2000 and XP).
Good luck tracking down the remaining issues. You seem to have a good grasp on what to look for, I have faith you'll manage.