Questions and answers:
I have understood that I can use the dialog editor of InstallDialogue for building my own dialogs, but will I need a resource editor if I need to make modifications to IS dialogs ?	No, with InstallDialogue, you can add/delete/move/resize controls directly from the script, so  there is no need for a resource editor.
If I register InstallDialogue, do I have to pay any royalties for each copy I sell of my program ?	No, the license entitles you to distribute InstallDialogue for use in your own setup without any further royalties to be paid.
I have already made a whole bunch of custom dialogs within a dll. Now I want to add InstallDialogue notification handling to these to get them intelligent. Can I use these dialog templates as they are, or do I have to rebuild them in InstallDialogue editor ?.	You can reuse all your old dialogs. This would be the same as modifying an InstallShield dialog box. It is described in the Tutorial, how to do just that.