Maybe I didn't understand how multiprocessing works but when running the
test code below I get 200+ processes in Windows and it never finishes.
It works fine on Linux.

This difference between Unix and Windows is documented there:
http://docs.python.org/library/multiprocessing.html#windows
Please carefully read the paragraph named "Safe importing of main module".

You will certainly need to add a condition like
   if __name__ == '__main__':
so that subprocesses (which start a new Python interpreter from the
start) don't start another Pool themselves.