Instructions that I followed are right HERE. I used the XO itself as the Linux box to create the SD card / format / partition it etc. I used my Mac G5 to download the torrent of the Hardy tarball and put it on a Fat32 USB drive.
So far, nothing I've found has solved the problem of time, network etc settings being locked. I click the "unlock" button in the dialogues, it blinks, waits, and then says, "Cannot authenticate" or words to that effect. Tried purging policykit through cli and had a bugger of a time getting the desktop re-installed - went with a whole new clean install (ugh) and it still doesn't work. Oh well. At least this is all faster than in the old Commodore 64 days.
It's awesome to move to a new Linux world - after Atari, C64, Amiga, Windows and Mac, it's not that big of a change (I'm still on Firefox, yo) but it's a whole other paradigm of install / update / configuration procedures. Hopefully I will soon just be using the machine naturally without creeping terror that I'll blank my SD card and be back on (shudder) Sugar. Sugar is truly a terrible system for grown-ups: THERE'S NO DESKTOP or FINDER equivalent. You have to find files in the Journal or copy them text-wise through Terminal - and most of the applications (sorry, activities) don't even let you control the save location. Yeesh!