WinME (and I know this for various reasons...) is considered a turd inside the manufacturer's residence. Cranked out to get some cash on the table, minimal changes were made, and some stuff from Win2k and the WinXP were shoehorned in without consideration for compatability/stability.
If you have to use Windows 9x, use Win95 2.0 (rev b, NOT rev c - rev c had some compatability issues) or Windows 98SE. Don't use ME. Period.
Personally, if you don't need some SERIOUS legacy compatability (esoteric MS-DOS stuff w/sound - I've had a bunch of old games working without sound in Win2k) you're fine with using Win2k, as long as you've got enough memory.
End of story.