I don't have much experience with lilo. That looks like it should work - no idea why it isn't.
While it's probably better to actually fix that, we can probably work around it. Once you've logged in, try running (as root)
Ideally that should be run before the stratum is enabled, but it's *probably* okay if it runs after. This will run the various bits of code Bedrock Linux wanted to run early on but couldn't. While you'll still see error messages on boot, everything should be good at that point. Consider placing that command in /etc/rc.local so it is run every boot.
If you do figure out why it isn't properly mounting the filesystem as writable, do let me know so I can make a note of it for the future. I do want to ensure options such as lilo are supported.
Background: Bedrock Linux wants to be able to write to the early file system so it can enforce a few standards needed to keep the various distros in sync. For example, some distros use /etc/machine-id while others use /var/lib/dbus/machine-id. Bedrock Linux tries to ensure one of those two locations is a symlink to the other, which naturally requires write access.
For the next release I'd really like to remove the requirement of touching the bootloader at all for hijack installs. I'm planning on removing this read-write requirement by having brn try to figure out which mount points it needs write access, remount with write access, do its stuff, then remount again as read-only to resume prior state. This'll be a non-issue at that time. May take a bit before we get there, though, and it'd be better to understand why this is an issue in the first place.