Baking With Milk

"Does baking with milk evaporate enough not to affect
people that are lactose intolerant?
Baking has no effect on lactose, the natural sugar in
dairy products. However, most lactose-intolerant people
can consume as much as 12 ounces of milk a day without a
problem, and a serving of cake or cornbread contains much
less lactose than a serving of milk, ice cream or yogurt.
If you're extremely sensitive, you can bake with lactose-
reduced milk. It's sweeter than regular milk, though, so
you might need to adjust the sugar."

-Food Network Magazine August/September 2009