smnirosh: if your server is in server and gateway mode and you have 2 dhcp servers (SME itself and router) but in different subnets, there's no problem.. BTW, you MUST be clearer wher you answer to questions..
we don't know anything about your setup, so BEFORE asking, you'd tell us how thigs are configured..
that said, I don't know why you're having this kind of issue, but in any case ILO should have a fixed IP, and you should configure it via bios.
I guess your server has only 2 nics, so one of them is working/can work in "shared" mode, i.e. as ILO interface and like a norlam nic.. is it so? did you read the user manual?
did you search in HP's support site for info? and with google?