First, congrats on your 120 GB hard disk! (that's becoz I am from India.. and we still are using computers a lot older than yours) ..
There are many tools that allow partitioning... may be the LBA settings might be a reason.. but not necessarily.
Consider having a Linux OS and a windows OS on your hard disk...
For partitions... there are many freewares available on the internet. Chech
www.download.com and categorize according to license. I am sure u will get a good tool.. Or check if you could get "HIREN's BOOT CD" on of the best tools on a CD. U will definitely have good partitioning tools in that CD.
Partition space could be allocated something like this (... not a rule!)
10 GB for LINUX
10 GB for WINDOWS (Primary and Active)
the rest of the dirve may be divided equally and under extended partitions having logical partitions with a file system supported by both the OS. (may be FAT32) ....
just a thought... think it over and make your own choices