I just finished doing this, and I had some confusion at the boot menu also. The boot menu options seem to be incorrectly displayed, because if I choose #3 I get the "Can't boot from MMC...booting from Flash" error, whereas #2 does boot my OS2007HE N770. I followed the instructions here and in the easy guide, and other than the slightly confusing menu it seems to have worked fine.

@bigred66: I don't think you should see any more memory in the Control Panel. As I understand it, the 770 has two chunks of flash memory: 64 MB for RAM-like use, and 64 MB for hard drive-like internal storage. What you've done is to increase the internal storage chunk (and also put it on a faster chip). So reading system and other files from that chunk should be a lot faster, and you aren't limited to installing only 64 MB total of applications and whatnot.

I am understanding this correctly, right folks?