I lost my way, need to backtrack here to see what I am doing wrong.
The c2d.exe step i was never able to do so I used furtsiv method and created a .norbin file with CEX2DEX program. I then used the .norbin on toolbox and it flashed it, I was able to set everything to debug mode.
I'm guessing I still need to go back to step 3 from this tutorial and run ps3gen to create the bdemu hdd. I did this part under vmware using xp. So now I have the usb thumbdrive and i set it to the right usb port.
I go into multiman now rebranded as multiman (dex) and I select a game that will not work discless such as little big planet, it takes me back to xmb but I do not see the disk icon.
Maybe it's best if I send you the eid and nor files and you can compile them for me? Where can I send them too?