When you add a folder to WinLess (either via 'Add folder' or by dropping it on the folder pane), WinLess will start watching the LESS files in it.
WinLess will automatically recompile a less file when it is changed.
If you have a folder called 'less' and a folder called 'css' on the same level, add the parent folder. WinLess will then automatically use the css folder as output folder.
Other LESS tools
There are several other great LESS tools out there.
Note: since all these tools use less.js to do the actualling compiling, they can be used in combination of each other.