Making bootable image for SS (OS 9.0, Rom from Rom Update 1.0)

I've gotten SheepShaver to boot from an OS 9.0 CD I had laying around using the ROM extracted from ROM Update 1.0, but I can't figure out how to make a bootable disk image from within SS - I created a dmg file with Disc Utility (250 MB read/write), set the SS prefs to point to it, and boot from the CD - the image shows up. Then I run the Installer from the CD, which works, and leaves stuff on the image as expected. But then if I restart SS with the CD ejected (with the 'Boot From' preference set to Any), it just gives me the disk-with-questionmark icon.. I have a dsk image with System 7.5.5 on it, which doesn't want to work at all, saying the startup disk wont work with this macitosh. Ideas?

Also, since the ONLY things I need to run are Newton Toolkit and MPW (for Newton C Tools), both of which will NEVER be ported (at least not by Apple), would it be better (faster, more stable, etc) to just run them in a 68K emulator like BasilliskII or vMac instead of a PPC emulator?

BTW, I would have posted this as a comment on the article on SS, but can't figure out where the "post reply" button is.. Anyway..

Thanks,
Jim Witte