It is an excellent modification to Windows 98. How well it works depends on what options you tell it to remove or disable. The final version doesn't go as far as the 2.x versions, however.
If you install the genuine Windows 95 desktop, you get all the 98 speed improvements without the massive bloat of the IE desktop (which more than negates all the 98 speed improvements). The effect is very noticeable on 486/pentium 1 machines. Although running on a VM on a fast "modern" machine won't see much difference.
The main drawback is that with the Windows 95 shell in place, some Windows 98 applications will attempt to call shell functions that are then missing.
Despite what Bill Gates claimed, 98lite permits IE 4 to be completely removed. (look for the 2.x versions of 98lite if you really want to eradicate all traces)
So many fun memories. There used to be a video of a couple of Microsoft employees "testing" 98lite and they were bitching and moaning about how "slow" 98 was after removing IE with 98lite, but never showed or described what they were doing that was so "slow". You know, you are just supposed to believe them.
And then there were all the Microsofties who would always whine "weeell how are you supposed to download another web browser if you don't have IE?! Whaaaaaaah!". And then I would stuff a shiny Netscape/Mozilla/Firefox CD in their face.
I recall early on there was some other program that also removed IE or the IE shell, but everything it did 98lite did and more.
If you just want to remove some of the visual clutter, search for "ThrobOff", that is just a small registry tweek that hides the annoying and useless throbber animation. Microsoft stuffed thobbers in everything back then.