I'll be taking as many shortcuts as I can so this won't be a long and involved process. I'll also provide instructions to build the most recent vilevn development release in said environment.
First, grab TDM-GCC to use as our mingw base. I would suggest the webdl installer for simplicity's sake. Install the 32-bit version, including all of the compilers (or at least the C, C++, and fortran ones...I don't think the others are used here, but it doesn't hurt to have them). You probably want to uncheck the Add to Path option...I'll show you a good way to work around that.
Next, grab MSYS and unpack it somewhere. Copy the entire contents inside the msys subfolder to the root of your new TDM install. Now, you will want to make a slight tweak to your msys.bat file, so open it up (preferably in notepad++ or pspad or some other text editor that can properly read UNIX line endings). Towards the bottom, find the lines:
if NOT EXIST %WD%sh.exe goto notfound
and add a line below that says:
Save and run msys.bat
Now, lets start out by getting the bare essential build tools. You should be able to copy these lines verbatim into your msys shell.
wget http://ftp.gnu.org/gnu/autoconf/autoconf-$vrs.tar.gz -O .tmpfile && tar xvf .tmpfile
./configure --prefix=/mingw && make && make install && cd ..
wget http://ftp.gnu.org/gnu/automake/automake-$vrs.tar.gz -O .tmpfile && tar xvf .tmpfile && rm .tmpfile
./configure --prefix=/mingw && make && make install
wget http://downloads.sourceforge.net/sevenzip/7za$vrs.zip && mkdir 7zip-$vrs