Proposal for Auto login using IE with webserver_auth module

My developer has told me that "IE won't send the automatic login credentials to an Apache server even with the settings explicitly telling it to do so" (we setup a GPO for IE auto-login with user/pass). Hence, we will have to move our drupal installation from a Linux server to a Win server running IIS just to allow our intranet users to have their browsers auto-login using the webserver_auth module?

Just doesn't sound right to me. Are there others out there using a Linux server for a Drupal intranet with auto-login and authentication on a Windows network?

If someone has experience with this I'd like to speak with you about getting a proposal.