Tried Rooting & got Stuck on Firmware 1.0...need help

This are the Steps i took
1. Download
the Original DreaIMG.nbh and the Original Cupcake update.zip:
Original DREAIMG.nbh
Cupcake Update.zip

2. Plug the phone into your computer via USB. Select Mount by pulling down on 
the notification bar at the top of the phone’s screen and selecting the USB 
notification. You should now be able to access the sd card in your phone on 
your computer.

3. Now, put the DreamIMG.nbh file and the update.zip (do NOT extract the .zip 
file, leave it as a .zip file) files that you just downloaded on the root of 
the SD card (NOT in any folder, just on the sdcard itself).

4. Unplug the phone and turn it off.

5. Turn on the phone by holding the Camera button and the End key until the 
bootloader screen comes up.

6. Hit the End key to start the update. DO NOT INTERUPT THIS PROCESS.

7. Once it is done, hit the trackball to restart the phone. You now are on the 
stock firmware RC29.

8. Then turn off your phone and turn it back on by holding down Home and Power 
and keep holding until you get to recovery mode (the ! screen).

9. In recovery mode, slide out the keyboard and hit Alt L to bring up the menu, 
then hit Alt S to Apply the update.
got to step 9,problem after that. Keep getting this::::

E:Can’t chown/mod/system/(no such file or directory)
E:failure at line 62 : set_perm_recursive 0 0 0755 0644
System : Installation aborted
please, i need help…What am i doing wrong?

Original issue reported on code.google.com by dobr...@gmail.com on 18 Jun 2010 at 12:11

Stryde2101 / android-roms

Tried Rooting & got Stuck on Firmware 1.0...need help #10