Ah I see... that's a little frustrating. I think I know what the problem is here and it might be a simple workaround.
Basically, what I've done before, and it's the way Corel Ventura (shudders) works for running heads and the likes.
I sometimes put in on the main page of text in white, somewhere discreet.
Chapter 12 \t Ceramics (or something similar)
I then just make that the style say, Running Head, paragraph style. I just copy the None style and rename it to something like Chapter Running Head and apply it to the text.
I then, on my master page, put in a Variable, also called Chapter Running head, to pick up the first paragraph style on the page called Chapter Running Head.
So now any time that InDesign reaches the point where I have a style Called Chapter Running Head on the paragraph style, it applies it to the Running Head.
You can automate the numbers by using Numbered List.
I don't have CS3 on this computer, so I'm going to link you to here, to show you the numbered list feature.
The ToC should now pick up the Style Chapter Running Head and insert in no problem.
The numbers for your ToC, I see where it can be quite difficult. But you don't necessarily need to insert them into another box.
You can use Nested Styles. Basically you tell InDesign to use a Character Style up to a certain character, it could be a tab, or a en space or anything, you just say, when you get to this character apply a different character style until the end.
More on that here:
This is part of the Paragraph Style. I always advise to have seperate styles for the ToC than the body text, called something like ToC Chapter Heading, ToC Body, ToC Page Numbers etc.
It's always best to have styles that are non-conflicting.
As regarding the way you have the running heads set up, and you're probably not looking forward to changing them all.
I will return tomorrow, as you caught me at the end of my work day, and I don't have CS3 at home to write up a comprehensive how-to for Chapter Number variables to be included in the TOC.
But I will, tomorrow. I think you have a bit of stuff to look at there for now. And I can think about it tonight.
Eugene