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I run IDLE under 2.1 on Win98 every day.  No problem.

From where did you obtain Python?  "Python2-1.exe" isn't a 
file name I recognize, so I don't know, for example, 
whether you got 2.1 from python.org, or ActiveState, or 
etc.  You certainly didn't get a file named Python2-1.exe 
from python.org.  The distributions differ in some 
respects, so we can't make any progress here without more 
info from you.