Problems after KB896424

I have a an old box running Windows 98.
I have a laptop running Windows XP Home.
The computer are networked

After installation of KB896424 the following problems occurred:

Laptop would no longer recognize the old box automatically. I could type in
the IP address in the address bar and it would connect.

Laptop would not send or receive e-mail (i.e. it wouldn't connect to the
server). The laptop runs Outlook 2000 and uses a mail database stored on the
old box.

I chose a restore point prior to installation of the update and everything
is back to normal.

Do I just avoid this update? Is that possible. Can I install the next update
without this one?

Randy