Standard Arduino boards, like a Diecimila, Duemilanove or even the Nano have a built-in ISP interface. It's there so you can program the AVR directly, and upload the bootloader on "bare" chips. All you need then is an ISP cable, like this one from Sparkfun.Or build an ISP (DAPA type) cable on the cheap -- this shows you how. You need a parallel port, other wise look for a more expensive USB ISP cable.You need to specify the type of ISP cable you use when uploading the firmware with avrdude or ponyprog. Check the avrdude docs for programmer type--they are listed under -c programmer-id
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Ah the chicken and the egg problem, in order to install the boot loader you need a programmer to program it to the chip. There are serveral out there that are very easy and cheap to make. I bought two from sparkfun.com, I believe they have schematics for the dirt simple serial programmer then using AVRDUDE you can flash the boot loader onto the chip.
thanks, i'll give it a try.