Using frames means to use several browser windows. To have the linked page coming up in another window than the dropdown menu requires that you call the "location" of that frame window. To do this you have to change the INPUT tag and add the location of the frame window you are calling:

<.INPUT TYPE="button" onClick="parent.frames[1].location.href = document.gotolocation.dropdown.options [document.gotolocation.dropdown.selectedIndex].value;" value="GO NOW!">

When you have frames the scripting language starts to count the frames windows with zero frames[0], the second one is frames[1] and the third one is frames[2].