Will have to say that you screwed up somewhere, as you don't give any relevant details how you installed - setup - fine tuned VPC2007/W98 I have no clue where it mangles.
I only can tell you I ran the game in VPC2007/W98SE and it runs without any glitch nor hickup.
So some general questions......
W98 or W98SE?
Installed VPC addtitions correctly?
Did you updated DirextX using the game's DX folder?
Did you uncheck D3D game's setup features as I told you?
Slowdowns: can be caused by anything that runs on the background on your PC and steals CPU power. No that VPC is utterly demanding, but it needs a lot of CPU clicks.
etcetera ... etcetera .... etcetera ...........
Did you followed Japo's how to for VPC correctly?
In stead of posting a pic of the playfield post a pic of the full VPC window running it, would at least tell me on what res you try to run that game and your W98 desktop res.
So much questions .... so much questions ..... and a lot more to come.
