Logically, the registry is one data store. Physically, the registry consists of three different files to allow maximum network configuration flexibility. Windows uses the registry to store information in the following major categories:
The User.dat file contains user-specific information, in the form of user profiles. This file contains logon names, desktop settings, Start menu settings, and so on. During Windows Setup, the User.dat file is automatically stored as a hidden file in the Windows folder, but the file does not necessarily remain there. If User profiles are enabled, users can have their own settings stored in the Windows\Profiles folder. In a network setting, this file may be located on a central server.
The System.dat file contains hardware-specific or computer-specific settings (the hardware profile). This file contains all the hardware configuration, Plug and Play settings, and program settings. The System.dat file is always stored as a hidden file on the local computer in the Windows 98 folder.
System policies are designed to provide an override for any settings contained in the other two registry components. System policies can contain additional data specific to the network or corporate environment, as established by your network administrator. The system policies themselves are contained in the Policy.pol file. Unlike the System.dat and User.dat files, the Policy.pol file is not a mandatory component of a Windows 98 installation.