I wasn't actually interested in running Jailbait anyways; I was just trying it because it was supposed to work :) So I didn't really spend any time trying to get it to work; it sounds like emaq is right though--the readme on FBM even mentions that you have to write the images to a 16MB flash.
I wanted to get NetBSD running on my IA-1; if anyone cares, here's what I did:
I had a NetBSD 1.5 CD around, plus a machine with a CDROM drive that could act as a NFS server and write raw images to the CF card. Also had a ADS Technologies USB-10BT ethernet adapter for the IA-1.
Write boot-big.fs image from the NetBSD CD to the CF card (using Diskprobe, although dd will work too... I've never used "dolly", but it sounds like it would work too).
Put the CF card in the IA-1 and booted from it; NetBSD installation process starts. Partition the CF as one big partition, no swap.
On the other machine, NFS export the NetBSD CD.
When the NetBSD install asks for how you want to get to the installation sets, tell it to install from NFS and give it your networking info (the ADS Tech adapter shows up as "kue0"). I just installed a minimal base system...
Let it do its thing, reboot, and it's done :)
If you're more ambitious, you can trim down the installation by deleting various utilities that you aren't likely to need, recompiling /bin and /sbin to be dynamically linked, compiling out Kerberos support then deleting the Kerberos libraries, recompiling the kernel to only exclude drivers that you don't need, etc... do the recompiling on another machine though :)