Thanks for the input.
I just got off the phone with lvl 2 Nxtl support and his suggestion was to take the device back to the retail location I purchased it at. I bought it last week so hopefully they'll be able to swap for me. The tech did confirm that an hour is much longer than it should have taken (I actually gave it more than an hour.) When I plug the device in now, Windows "sees" the Blackberry but the BB does not report its PIN.
I suspect that it's probably Win 98 and not the speed of the computer (600mhz)... but who knows.

After all, there was no indication that the blackberry desktop software was doing anything but waiting for an acknowledgement from the device.
I'm going to try to get XP or W2k and run through it again. That way it will help show if it was the slower CPU or Win98 that caused it.