You can use many different type of Telnet emulator on Dynamips. Simply modifying Dynagen.ini with few parameters.
See below guide to change default telnet.exe to putty.exe
Just add below line Dynagen.ini after put # on current
# Uncomment below for Windows
#telnet = start telnet %h %p
# For PuTTY users:
telnet = start C:\p\putty.exe -telnet %h %p
Done!
Now, putty will be popping up in next around with Dynamips