Found some more on how to replace a file with System File Checker, Barra, but I think you should check with someone like Adept, to see if this is the right thing to do, before trying it:
1: Go to start then run, type "sfc" then click OK or hit enter.
2: Click on "settings"
3: With your Win98 CD in the CDROM drive, click on the "Search Criteria" tab
4: Click on "Add folder"
5: Using the browse tool, highlight the folder "Win98" in your installation CD (Often D:Win98 but it depends on your particular system setup)
6: Click on OK, click on Apply, click on OK
7: Select "Extract one file from installation disk"
8: Type "KRNL386.EXE" in the text box and click Start
9: Select your Win98 folder in the "Restore from" drop down
10: "Save File In" should be the directory of your Windows system folder, usually C:WindowsSystem
11: Click ok, and ok again to backup your existing KRNL386.EXE file
12: Restart the computer at the prompt and shazaam!
I hope....
These are for Win98, but I'm assuming the same applies to ME. I'm not sure if this is the right way to go about tackling your problem though. :-