There's a product I used - very effective - very sticky and although a bit costly far far cheaper than replacement windows.. and more satisfying. Video here...
http://www.youtube.com/watch?v=o4U-008X9oA&feature=related
Three grades of Product - 1 hour 4 hour & 16 hour curing time
4 products in each group - 2 part sealer and 2 part resin.
Cut out rotten wood - mix up and apply sealer - mix up and slap on resin filler and press on new sill - wait overnight and sand to shape - decorate.
I did a major refurb on my bay windows - ground & 1st floor - each with 4.5m sill and each with 8 large panes with smaller lights above - 32 panes in all.
Total cost including paint about £300 - perhaps half of it on the resin.
Regular DIY stores do not sell it - I bought mine from a Dulux Trade Centre.
I am not an agent for this product - I just think it's very good indeed.
Good luck...
Peccavi
September 2010