What you are talking about is doing a "partial boil", and then "topping off".
Partial boils are fine, and many brewers with limited space (such as myself) and on electric stoves (such as myself) do them often. If the recipe calls for a full boil, then you may need to adjust your hops slightly (beer calculus at www.hopville.com
can help with that).
Other than that, do a search for the terms above, or go to the HBT WIKi - tons of information there that often gets overlooked.