I suggest you don`t even try! The number of floppys would be huge and I don`t think it can be done anyway. A floppy disc stores 1.4 Mb of data and you`re looking at the CD Rom holding up to 500 times that.
You cannot load XP onto two machines legally anyway so if you`ve activated XP on your desktop it won`t work on your Laptop.
Thirdly, If the old laptop was Windows 98 as opposed to 98SE I doubt if it will even be capable of running XP. Look at the minimum requirements for XP in terms of disk space, RAM and processor speed - will your laptop be up to that spec?
Sorry to put a dampener on this but if I were you I`d simply reload the Windows 98 version.