There is kinda a bug with Vista-VPC2007-W98
To get full CD audio support you must (after installing the VM additions in W98) open the W98 device manager and command an update of the SB16 sound device driver.
When asked state you have a disk and point towards C:\Program Files\Virtual Machine Additions that are copied on your VPC-W98 C:\ (but not installed correctly) by VPC2007.
That should sort things out.
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