HD Install :: insmod cloop?

In this article: http://rz-obrian.rz.uni-karlsruhe.de/knoppix-usb/.

In the section "modifying miniroot.gz" and just before the section "Preparing the Memory stick", the author wrote: "Mount the compressed KNOPPIX file (insmod cloop file=PATH/KNOPPIX && mount -t iso9660 /dev/cloop /cdrom)". Does anybody know what this statement mean?

When I typed this statement, I got the error: cloop is already existed.

I ignored this error message and finished up the remastering booting DSL from USB. But DSL could not boot up due to KNOPPIX system was not found. I found out that a statement in linuxrc tries to locate /cdrom/KNOPPIX/cloop.o. The missing cloop.o caused the error "KNOPPIX system not found". Any solution to solve this problem?

After that I tried the new version DSL 0.63, which contains USB module. I encountered the same error "KNOPPIX system was not found". How is that?

original here.