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There is a way to use it without the CD. - Install as usual, Quit bookshelf. then copy the entire CD to a folder (call it Bookshelf CD and store it in C:). Eject the Disc then launch Bookshelf. It will complain ti can't find the disc and then offer you to tell it where it is. Key in C:\Bookshelf CD, and click ok. Then from now on it will always think the CD is in the drive and use that location. Confirmed it works on 98 with NT4.0. Although not tested, I also assume Encarta will be the same. The app is designed to be ran from HDD, but as space was a premium back then; Microsoft chose to keep it on CD but the HDD feature still exists.
Bookshelf 2000 had an option to the steps shown below once you booted into it, it was buried within though. - I actually liked this software and was far more easier to reference than how we do it today with the internet (and being constantly spammed with Ads).