Why not to copy whole system to mmc and boot directly from it? Looks easier to me than use ExtendedRootFilesystem. And as a bonus you can have internal flash with clean system as a backup and boot it if something goes wrong with your card and e2fsck it. I have it like this for two weeks and so far had no problem and the speed is comparable with internal flash. Didn't notice any slowdown.

http://maemo.org/pipermail/maemo-dev...st/005040.html

Edit: not two weeks, just one (but seemed like two :-)