@sanjeev.a.rangaswamy
i think you need to clarify what kernel you want to use, and fix the leafpad edit command accordingly, because when cr.shaggy said leafpad was openning a blank page, it was because your command line is incorrect, you have 'leafpad /etc/multiboot.d/11-NITDroid-mmcblk0p2-2.6.28.NIT.item' it should be 'leafpad /etc/multiboot.d/11-NITDroid-mmcblk0p2-2.6.28.NIT.06.item'
its a little error, but it makes a world of a difference.
and another thing at the start you link to the 'rc7' kernel but it links to the 'final_armel' kernel, then later you later say to dpkg the 'rc7' kernel, even though you have linked the other.

fix this and your guide is fool proof, and let them know that this makes a standard 2gb fs

@xeondead, ive learnt from my mistakes (n900 flashed 15 times in one day, both fiasco and rootfs) resulting in a dead phone, im only trying to help stop unknowing people from killing their phones, then having a cry about it. i no longer have a n900, wish i did, but i hope that some one can lend me a n950, so i can finish my uni project :'(