Sorry, bud. I have never seen a way to do a system restore from cab files in Win98 and I couldn't find any info on it. You could try and PM NooNoo and see if she has any suggestions. Noo seems to come up with the hard to find solutions no one else can find. If you have a computer made by a major manufacturer (like Dell, HP, etc...) then chances are the cab files have all been loaded into a folder on the system so that you don't have to insert the OS cd to remove/install OS apps. It is usually placed in C:\windows\options\cabs. If this folder is there, you may find setup.exe. Double-clicking on this will rerun setup and you may end up having to reinstall some programs after rerunning setup, but at least you'd repair your registry and be able to run OS-specific apps.
There are a few other things you can try here. Scroll all the way to the bottom to Restore Damaged Registry.
In the future, if you want to mess with the registry, back it up first. If anything goes wrong you can just restore the backup. The clickable link I listed above explains several different (and unconventional) ways to do this.
Wish I could be more help. Good luck...let us know how you come out.