Q: does index-pack work in place on windows?

... or any other (operating / file) system where you cannot unlink a file that is open?

When you run

    $ git clone git://some.where/repo/sitory.git local
    $ cd local
    $ git index-pack .git/objects/pack/pack-*.pack

there is a call to write_idx_file() in builtin/index-pack.c, that feeds the correct (and existing) name of the corresponding pack idx file.

The callee in pack-write.c, after sorting the list of objects contained in the pack, does this:

	if (!index_name) {
		static char tmpfile[PATH_MAX];
		fd = odb_mkstemp(tmpfile, sizeof(tmpfile), "pack/tmp_idx_XXXXXX");
		index_name = xstrdup(tmpfile);
	} else {
		unlink(index_name);
		fd = open(index_name, O_CREAT|O_EXCL|O_WRONLY, 0600);
	}
 
and then writes out the pack index to the file descriptor.  But index-pack
uses the usual has_sha1_file() and read_sha1_file() interface to validate
the "existing" objects, and is likely to have mmapped the .idx file when
it called use_pack_window().  Which makes me suspect that this unlink (or
the open that immediately follows) may fail on systems that do not allow
unlink on inode that has still users.