The windows 9x 'Ghost Driver' phenomenon is caused by the differing behaviour of device manager in normal and safe mode. In normal mode, device manager shows the drivers for every device currently present, but in safe mode it shows every driver installed on the system, including drivers for devices no longer present. This can give the appearance of multiple copies of the same device.
Windows 9x identifies devices by a combination of their plug and play ID, and the devices below them in the device heirarchy. This allows it to correctly determine which device is which if the computer has two or more of the same device (allowing it to, for example, assign the correct IP address to each of its network cards, or remember which graphics card is connected to which monitor). The same card is considered a different device when plugged into a different PCI slot, and has a different driver instance for every PCI slot on every motherboard it has been used in.
In normal operation, device manager only shows the devices which are connected at the moment, and thus hides all but one of the device driver instances corresponding to each card. In safe mode, the device configuration system is not run, and device drivers are not loaded. This avoids any crashes caused by hardware detection or malfunctioning device drivers, but as a side effect renders it impossible for windows to determine which devices are currently connected. Rather than guess at which devices are present, all devices windows has ever encountered are shown.
Deleting an unused driver for a device will not affect the operation of 9x in any way, but deleting the current one will cause windows to re-install the driver the next time it is booted to normal mode. Deleting all drivers for a given card is an easy way to ensure that the driver is re-installed next boot up.