First, what distribution are you using? Sounds like maybe Mandrake?
The part you left out, the part after error:, is the important part.
Depending on what the error is, it might affect something.
You're dual booting, how? Lilo? And your GUI works if you boot into Windows first, and then reboot into Linux?
The only thing I can think of that would do that is if Windows was doing some hardware config and leaving settings in PRAM, or something, and Linux can detect them but not configure them on its own.... but that would be just weird. And I dont' see it happening on an anywhere-near modern machine.