I've been using 2.7.2.  The kernel is fine, and, apart from one problem,
so far libc is fine.  (It was a 68k problem, and only shows up if you
use gas-2.6).

(libc is building as I type.)

The file that fails is csu/m68k/crt0.c, which fails because gas 2.6
considers "bcc 1f" a syntax error.  I replaced 1f with "_s_s" and replaced
the "1:" below it with "_s_s:" and all appears to be well.  (I hope.
If it isn't, bad things happen.)

-s