Well – it appears that there is a bug in the Virtual Machine Additions video driver for Windows 98 that was included with Virtual PC 2004 Service Pack 1. The bug manifests itself in the following ways:
1) GDI+ applications crash if they try to draw a groupbox
2) Windows 98 Hebrew has font corruption problems
3) 8bit Fullscreen DirectX games (Warlords III, Curse of Monkey Island) only refresh the screen once every 2 to 3 seconds
Thankfully all of these problems can be resolved by turning the video acceleration under Windows 98 down two notches (Select ‘Properties’ on ‘My Computer’ –> ‘Performance’ –> ‘Graphics’ –> Turn hardware acceleration to one above ‘None’). This doesn’t negatively affect performance at all.
On a side note – this is one of the reasons why I appreciate the Microsoft WHQL Program (WHQL stands for Windows Hardware Qualification – and is what you need to do to get a driver to load without warnings under Windows 2000 and XP). The WHQL program gives us a complete test suite to run on our Windows 2000 and XP video drivers – that ensures that we never have problems like this – on those platforms.
Unfortunately for Windows 98 we have to test the driver by just running a number of programs and confirming that there are no display problems.