As Fulvio already asked, I will try to write a tutorial on the use of the dev vmware image. However I would also have some scripts allowing the creation of CF card image as well. So far I have not completely found a way to do it in a file (lack of knowledge here!).
Furthermore there are still many problems with the dev image regarding software compilation (dietlib, libdl, etc…).
For the upgrade the above script should be enough to go through provided you have the CDROM.iso. Of course it requires manual work.
My idea is to work on larger CF card as those are now so cheap and allow enough space for the second partition to be upgradable without size issue. Something like 200 MB would be good.
Note that we could also avoid having isolinux and thus the size of twice the kernel and initrd image, as in any case the boot is done from the first partition on the CF card.
However I suspect the ISO image is also used for the CDROM mode.
As you can see many things are possible. I saw many people requests which I could already integrate in a new CDROM.iso of 150MB.
This includes adding boot time sync for ALIX without battery, racoon.conf set for VISTA L2TP/IPSEC, etc…
Give me some time to create a new CF card image of lets say 2GB allowing later upgrade.