At first you should copy the contents of the archive from the froyo beta release to your My Storage root folder.
On the project page there is an alternate install script for the first haret-session (the one which creates the android partition and copies the system files). It can be downloaded here.
This file (sd.cpio.gz) must be exchanged with the version in the 'o2beta' folder (just replace the file on your phone). The problem with that script is, that it was written for an older version of the project (beta1 for the android 2.1 version of the project). So it expects the system files in an ext2.tar.gz archive. Since i have no clue how to extract and rewrite the script, just rename the ext4.tar.gz from the froyo-beta package to ext2.tar.gz. The installer will recognize it and installs correctly. Just don't forget to place an empty file with the name 'installinternal' in the root folder of your My Storage as stated in the guide.
You are now ready to install the froyo-beta android to your device. Just run the 'haret.exe' from the o2beta-folder.
To start your freshly installed android, you now have to change the 'startup.txt' file in the root folder of your My Storage.
The following line:
Set CMDLINE "rootdelay=2 root=/dev/mmcblk1p2 init=/init"
has to be replaced with this line:
Set CMDLINE "rootdelay=2 root=/dev/mmcblk0p6 init=/init"
You are now ready and set. Just launch your o2android with the 'haret.exe' in the root folder of your My Storage. Enjoy!
PS: There is one problem with this approach though: Your android partition will be formatted with ext2 instead of ext4 but this should not be a problem since the froyo beta1 build doesn't enable journaling anyway. Maybe someone with a little more knowledge than i have can rewrite the install script in sd.cpio.gz someday...