If you are starting your Linux throw SuSE CD because your Lilo doesn't install then you probably don't have ppp support in your kernel because that.
The kernel used to install or recover SuSE is not a full functional kernel. When you solve your lilo problem and boot using a regular (with modules) kernel build your ppp problem should be solved.

I've been using SuSE since version 5.3 and I' m still using it and I like it.
But now there's knoppix. The boot CD is the best tool I've ever had as a Network Administrator. It has a wonderfull selections of packages !!!
Now I use SuSE 7.3 at my home desktop and knoppix 3.1 hd intalled at my laptop.