I have a similar problem with Messenger on Windows 98.
Since a few days, everytime I open MSN Messenger, the Messenger and Plus sounds don't work and when I try to play music, it says that there is a problem with the sound device and it may be in use by another program.
I then shut Messenger down and open an audio file and while it is playing, open Messenger and the sounds work again....
That's really strange, no idea how to fix it.
Everything failed, reinstalling WMP 9, Codecs etc..
Help ?
You could try it, play a music file (eg mp3) and while playback, open Messenger and see if the sounds work