Waw it took me 5 minutes to figure it out.. This is what you need to do
first boot to windows xp.
In control panel --> Blue Tooth, then remove the keyboard device. make
sure you are in software mode.
Click ok
Then go the Microsoft keyboard software in the program files.. Under
the wireless tab click connect.. follow the instructions  press  the
little  pin on your mouse to detect the device then press the little pin
on your keyboard to detect (on this process there is no passkey set
yet(hint))... When you click next press cancel on the next process to
skip the passkey initialization. To check if it works go  back to the
blue tooth in the control panel and check on the device there should NOT
show any keyboard devices.  Boot to Vista and do the same process.. This
is a little glitch on the keyboard software that helped me a lot to get
the wireless keyboard work on dual boot mode...