heh, I'm no guru, but I can tell you what running lilo does.

Lilo installs itself in the bootsector which on a drive is 0,0,0

it's gotta be 512 bytes (I think it's bytes) long and end in 0x55, 0xAA

it's asm instructions of what to put in which registers, etc.

now that you know the REAL basics of it (I haven't delved into protected mode and the A20 gate) you should know what the bootsector does. it makes a jmp call to whatever sector (or if it knows how to look at the filesystem it calls the file) and pushes that onto the execution stack. running lilo doesn't do anything to your kernel, it just puts the location of the sectors your kernel sits on into the bootsector.

and if you don't run it it will not work

Yup

I found that out the hard way!!