It will be acceptable if it is a full retail or upgrade copy.
However, I suspect that it is a full OEM copy, and thus would be illegal to use on any other hardware without a new license. Given the comparatively modest cost, I suggest that you buy a retail upgrade copy of XP, which can be installed in the same manner as any other (ie, a clean installation if required) and your old 98 CD will be examined during the installation.
If you do not have the 98 CD, then you could stretch the EULA a little bit by borrowing one or buy a full retail copy of XP. This assumes that your 98 license is full OEM or full retail. A retail upgrade copy of XP converts an OEM 98 license into a full retail 98 license.
I will not get into the possibility of buying an OEM copy of XP with some hardware as that is complex/questionable and I am not a lawyer.