That didn't work unfortunately.
Here's what I did:
I marked the z: drive (Windows 7) as Active
drive c: says active as well
I rebooted with the Windows 7 disk, and it automatically detected a problem with the Server 2008 installation on drive c, and wanted to repair it (because I used the bcdedit.exe program I think) to put it back on the list. I selected no, and then had it try to repair the Windows 7 installation. I did this twice.
I went into the Bios, but didn't see any way to change the actual hard drive selection on startup. It had the normal boot sequence options. NOTE: The "c" drive with Server 2008 is a SATA drive, not ide. Don't know if that matters.
I went back into Windows 7, and again, could not delete or format the Server installation.
Not sure how to proceed now.