Yeah, the windows boot loader works fine. I used to use it all the time b4 grub came along. It works something like this...
Install lilo to the boot sector of the linux partition or drive. I've always kept my linux and windows on seperate drives so that each will boot on it's own and my data isn't at the mercy of install programs.
Copy the boot sector from the linux drive onto the windows drive. I usually leave a small fat partition to copy the file from the linux system on to the windows drive. The boot sector copy is done with "dd -if=/dev/sda0 -of=bsect.lnx -bs=512 -count=1" where /dev/sda0 is the boot partition (typically mounted /boot)
After getting that block onto the windows partition, boot windows and add a line to C:\BOOT.INI
C:\BSECT.LNX="Linux"
Every time you update the kernel and have lilo modify the boot sector of the linux drive, you have to also copy the 512 byte boot block to the windows partition. I don't know if that's true for grub or not, haven't dual booted with grub.