Also remove and do not run any 16-bit applications you may have. 16-bit applications are not well known for their stability, and they have the uncanny ability to bring a working system to its knees. If an application has not been rewritten in 32-bit for Windows 9x, then find another app that will replace it. Drivers are another cause of instability. More often than not drivers are released to correct bugs in earlier versions.
Bugs usually equate with instability.
Video drivers are one of the major causes of system instability and really need to be kept up to date. Screen savers are another major culprit. They may look nice, but they also have no real benefit any more. The second category is hardware. It is quite possible that hardware in your system works fine until it is pushed hard.