I think you have a catch-22 here. Yes you can test for the existence of the directory but even if you can create the user directory you can not create the share from Win9x clients. You must go to the server & create the share.
Jooel has a point, if you were to create a subdirectory on a share, it would presumably have the same ownership permissions as the mother directory which by definition must allow everyone full access. Thus your user directories would be wide open to everyone. You would have to override this on the server for each user.
Normally, one creates these kind of things on the server. Setup a script that creates the user account & share at the same time. Whenever you add a user, do it with the script.
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Jack
