Earlier quoted context omitted.
There still was a tiny bootloader happening on that floppy. I /think/ back then it was still lilo (slackware boot floppies) OR syslinux bootloaders
I'm relatively sure it worked without lilo (but that's so long ago I might be wrong). This stackoverflow question suggests support for this was explicitly dropped from the linux kernel: https://superuser.com/questions/415429/how-to-boot-linux-ker...
But the later convention was to create a loopback device tied to a disk image, mkfs.minix it, mount it, copy the kernel and an initrd, and run lilo on the loopback device. Then unmount and decouple the loopback from the disk image and dd that to the floppy. It didn't really take up any extra space and made it easier to update your initrd or kernel.