Still using LILO, but I finally got it to go. Hmm, will have to look thru the source code for lilo, someone may have changed it to limit the size of the "/" partition, for some unknown reason.
I state this because the original error for lilo on v12 occurred on a ~40 gb partition, when I attempted to reduce it to ~20 gb, same error. Then when I reduced it to ~10 gb, no problem, installed and is up and running.
What an 'undocumented' issue, very MicroSoft like. Come on guys, document all, especially open source.