Hi Arik,
Sorry, but I still can't duplicate your problem... I tried running an exe on a 98 machine using the hidden attribute, and it appeared to work fine (valid handle, no error) Obviously I couldn't see it, and as there is no useful task manager in 98, it's difficult to prove that it's working.
I did, however run a batch file in hidden mode, and that did appear to operate correctly...
You can send me your code if you like to see if I can duplicate your problem
Regards
JB