Editing boot.ini for dual boot
 

i was able to copy the linux_bs.bin onto a floppy and then placed it on my C:\ drive. The only problem i am having is what all must be placed in the boot.ini file exactly? I read somewhere that all you needed to specify was C:\linux_bs.bin="Red hat" But that doesn't work it just gives you a flashing cursor.

What am I doing wrong?

Your boot.ini info is correct from what I remember.

Before creating the boot sector file did you set lilo up to boot from / ?
You need to install lilo to boot from /dev/hda2 assuming second partition primary master. Then create the image...

dd if=/dev/hda2 of-linux_bs.bin bs=512 count=1

You'll want to remove or comment the prompt line in lilo.conf so it just launches instead of displaying the boot prompt..

<edit>typo</edit>