This would agree with my investigations. In my case, I was working with an IBM T42 and attempting to make the machine dual bootable, including leaving the IBM diagnostic partition bootable using Fedora Core 2. (I do know about the BIOS/IDE geometry issue and used the appropriate workarounds for that.)
My first attempt was to use Partition Magic to reduce the size of the Windows XP partition, install Linux partitions in the free space created, install grub in the linux boot partition and make the linux partition active.
This did not work: two possible hypotheses. I had something configured wrong in grub.conf. OR. Either the BIOS or grub didn't like the fact that grub and/or its stage1.5 were beyond the 2 GIG boundary.
I finally gave up, and installed grub in the MBR. Have a successful dual boot machine, but can not currently get the IBM diagnostic partition to boot.
Try adding these lines to your grub.conf, assuming that your diagnostic partition is hda1:
title IBM Diagnostic Tools
rootnoverify (hd0,0)
chainloader +1Paul.
