Paterno himself said he never knew about the 1998 investigation, and nobody has produced evidence contradicting him.
You won't find any such evidence in Paterno's archives.
You will, though, find something curious, and perhaps, depending on how you interpret it, troubling.
You will find, if you dig into his archives from 1998, that he was a very busy man — he wrote in one letter that he had "committed all my free time to" and was "really stretched" by the ongoing fundraising campaign. You will find that he was a very reliable man as well. When he planned to do something, he would do it. In fact, if you look at his agenda from 1998, you'll see that he almost always kept to his schedule, and that his only cancellations fall within a very narrow window of time.
The first cancellation is on May 15, two days after police listen in on Sandusky's half-confession to the mother of a young boy. That evening, Paterno cuts short a fundraising trip to Valley Forge, then cancels a four-day-long personal vacation he had been planning to take from May 16 to 19, to his summer home in Avalon, New Jersey. He resumes his scheduled fundraising trips in June, about a week after the investigation against Sandusky is dropped. He doesn't miss any more events for the remainder of the year.
The following season, Sandusky abruptly and unexpectedly announces his retirement.
Did Joe know?
Who knows. The files raise questions but provide no answers.