First off, don't think of musicals as this whole other world. It isn't, really. People strike up conversations (duets), talk to themselves or the audience (solo pieces), talk in a crowd (ensemble pieces), and repeat things (choruses). Only instead of speaking to convey the same information that would be used in a play, they sing
That's how people suspend disbelief when watching a musical, at least for well-written ones—it follows the same basic principle as well-written plays, using music as a framing device for the plot underneath it, instead of an excuse to rely on catchy melodies and dance numbers as filler.
I would suggest writing dialogues, monologues, and really any scene where you want singing in the same way you'd write a regular story, before arranging them to fit into a musical format.
edited 2nd Apr '11 9:42:51 PM by Leradny