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 a lot of other great LESS tools out there. Be sure to check them out.