Here is how you set it up. Copy all the files for the login page and put them into a folder such as 'newlogin'. Then what I did is placed that folder into the Moodle Root folder under 'login' so that the file structure looks like:
Then you go into the moodle settings and find where you can select an alternative login page and it will ask for a URL to the new login page. The Alternate Login Details are found on SITE ADMIN > PLUGINS > Authentication > Manage Authentication. You have to scroll down and you will see where Alternate Login URL details can be entered.
Following my example above you would enter for alternate login:
Also, it doesn't matter where you place your login files. I could host the files for you here on one of my servers and you could use it to login to your site. So just pick a folder/place to put them and then add the URL into the moodle settings.
I forgot to mention that you will want to change one line on login.php
<form id="form" name="form" method="post" action="http://moodle.dearbornschools.org/login/index.php">
You obviously want to change this to your moodle login domian.
Let me know if you have any other questions.