The 160 GB disk is the problem here. You are running into a thing called the 48bit addressing, which would limit the drive to 137 GB. You can still use the 160 gigs, if you overcome the "48BLBA", you should overcome the problem.
Windows NT does not need to be on a primary partition, and my suggestion here is to set the thing up as a small (20 MB) FAT16 partition, and the balance as an extended drive. You could have something like a 120 MB fat partition (this overcomes a DOS problem when the first partition on the extended drive is not FAT32. It is also used for data exchange between the two operating systems. If you make this over 120 MB, Windows 9x will try to change it to a fat32 partition.
Partition E can be a 2 G fat32 partition. You install Windows 9x into this partition, and it will create a small amount of files on the C: drive. My experience is because of the shared C: drive, to install different Windows into different names.
The next partition F can be an NTFS partition. If your machine is limited by the 8 GB limit, it is best to limit this drive to 2 GB also. Install NT here. It will recognise the Win9x and add it to the boot menu.
Neither of these OS versions can access past 137 GB, so the remainder would go missing, but you can create both NTFS and Fat32 partitions up there. Where you have a network, you can copy the Windows NT setup onto the D: drive, and run winnt.exe from there.