YOLO: How many bounding boxes?
From 98 boxes to 3 boxes, it involve many other things as well. 


  
  x*y*2 = 98, where 2 are the anchor boxes i.e. each grid will predict two bounding box. 
  Non Max Suppression: As correctly said by you, discard those boxes which have lesser probability. You can set some threshold value.
  IOU (Intersection over Union): Step used to identify and discard the overlapping boxes.
  


Once you done all these activities you will get 3 final boxes.


  More about the complete process:
  
  
  Discard bounding box which has low confidence score. Say less than 0.6.
  
  Now pic the grid having highest confidence score. As mentioned below: 
  Here 0.9 confidence score has been picked up.
  Now identify all those girds which has IoU score greater than some threshold, say 0.5. Here highlighted in dark blue and discard such
  grids. 
  
  
  
  
  
  Still left some grids which predicts the object say car, but IoU is low that is not yet discarded. Repeat such process from step 2 again,
  until we left no such grid.
  


Note: Suggest you to read more about last two process as it involve the core concept of identifying the bounding boxes.