Run, don't walk, away from any project manager who is intent on deploying a new software system on Windows 98 (this is not MS-bashing but just common sense, if someone were to ask me to deploy a new application on Redhat 5.0 I'd have a similar reaction). The OS isn't even supported anymore, has numerous known bugs and security weaknesses and these days is only justifiable for legacy systems. A manager who doesn't understand that displays a frightening lack of clue and working for him will be painful.

Other than that, from your description I don't see anything that would preclude using Perl for this project. If you run into any performance bottlenecks along the way you can always rewrite critical parts in C or another language, Perl's language interoperability is pretty ok. In the meantime you should be able to get a working system up relatively fast (since you already know Perl) and that talks more than any argument for or against a specific language.