Was reading this old thread trying to set up ED image, and stumbled on super easy way to create ED partition using KDE partition utility...(I was using Kubuntu):

-Download ED image and extract .ext2 file
-Hook up n900 in mass storage mode.
-Open partition utility and make unpartitioned space on SD card big enough for the image (about 2.1 GB)
-Open 'partition' menu and select "restore"
-Choose the ext2 file. Voila, the complete ED partition will be created!

Then just install ED Chroot, and change /home/user/.chroot to point to the partition. The line will look like "IMAGE=/dev/mmcblk1pX" where X is the partition number...ie 1 if it's the first partition on the SD card!