Did you get this figured out? incase you didn't, see if you have the default "paint" program installed, open up paint from the start menu, accessories, paint.exe from the paint tool menu, go to file, then select open, navigate to the folder where your file is saved in, select file types, .* or "all", find your image, usually a .jpg, then click open.

Once your image is loaded in the paint program editor, select Image, from the toolbar at the top of the paint application, then "stretch/skew" from the Image menu, in the stretch field, select the amount of "reduction" in percent values, if your image is 800x600, a value of 10 percent, for height and width, would give you 80x60, but the canvas area stays the same as the original at 800x600, or whatever size your original image was.. Use the corner crop marker at the edge of the canvas area, click the corner at the bottom right edge of the canvas, then drag the canvas area to the edge, or slightly over the edge of the resized image, let go of the mouse button after dragging, then go to the file menu and select save as, rename the file so you don't overwrite the original..

Paint only allows you to save as a bitmap, choose 24bit color bitmap to have the best image quality, this may cause the file size to excede some site's avatar file size limit.. If you want to avoid that issue, I'd recommend downloading a free or trial image editing tool that is compatible with windows 98, or buy a decent image editing app also compatible with 98, use one of the free online image resizing tools to get a smaller .jpg or ask one of your buddies to use their image editing software to resize it for you