YOU CANNOT CHANGE OR SETUP the kernels or boot entries at runtime.
Also, literally the LILO bootloader does not know about filesystems, it just read particular sectors from a particular device. That's WHY you should update it at every Kernel or device change.
Additionally, the LILO "shell" just and only gives you the ability to add particular parameters to a known Kernel entry. Nothing more.
Long story short, honestly I do not see its utility while being included in a BIOS.
For example, you should flash a new BIOS every time when you partition, add or remove a hard drive. Which is a laughable idea.