You do NOT need steam.
Burn the ISO files as CDs.
Install from the CDs as usual and then follow the instructions on the getting started thread:
http://www.project1999.org/forums/showthread.php?t=2651
You will need to register an account in the EQEmulator forums and, from there, you can create accounts for the game.
Do NOT start the game until you have made the changes as per the "Getting Started" post and NEVER patch the server.
The easiest way to set everything up for Project 1999 is to use Duxa's Installer:
http://www.project1999.org/forums/sh...ad.php?t=28335
Good luck.