I think I'm getting closer to an answer:
You say, horus, that with LILO in MBR it will take over the rest of the boot procedure from BIOS? That means, if you install LILO in MBR it never matters which partition you mark active?
If this is the case, will installing LILO in hda1 make any difference? I'll have to test that - I simply have to know.
Also, if it is as you say, then LILO does more than other DOS/Win-based boot-loaders - with any of these in MBR (only place you can have them) you still boot from the active partition, overriding the bootloader in MBR.
It also means that my fixed disk & motherboard is not weird (not concerning bootsectors at least) You see, I've had a few problems with ports, don't know if it's the mobo that's a bit corrupt.
I know my setup might seem a bit odd, but I test new distro's as often as I can. I don't want to take the risk of not beeing able to boot my ordinary OS - I could fix it, but my kids & wife use this computer too.
Just imagine, wife boots up and can't choose her Windows ... (oh well, it's gone now. I made a small mistake... > ) She doesn't like to use Mandrake, but she has to and she's not complaining much any more. But what if she boots up and finds a fresh installed Debian (without mouse) Solaris (with Gnome instead of KDE) etc
I'd have to sleep on the couch the rest of the month...
Just for your information:
I use fdisk - the best partitioning program I've seen.
I have 4 pri partitions used,
hda1 = vfat for Windows
hda2 = ext2 for experimenting / testing distro's
hda3 = /boot ( several distro's / is on logical volumes)
hda4 = extended.
I tried to make hda2 a Win-partition, but Win98/WinNT didn't see it, it was immediately changed to "hidden".