Sorry for taking so long to reply, I've been away with the family on vacation [and the online time was pretty much corralled by the youngsters

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You could try life without the diagnostic partition, since it's a small drive... I think you'll get more usability from the laptop that way (4 gig fills up quickly nowadays!).
You can clear the hard drive like I mentioned in my earlier reply, take the precautions (disable the Bios Antivirus, remove PC Cards in the slots, etc.), and try a clean install.
If you'd like, visit the webpage rjfvillarosa mentioned for the drivers & burn a driver disk ahead of time - this can help speed up things.
. . . Gary
[P.S. ... also, if you'd like, you can use 3rd-party diagnostics to test the memory and hard drive. You can try MemTest86 for the memory (
http://www.memtest.org ) and go to the manufacturer of the hard drive for the disk diagnostics - these will run in DOS from a bootable floppy --- it's likely you have the IBM TravelStar 4.3gb drive in there, so you can use the IBM disk diagnostics]