3) For some reason when I booted the xen.gz file as the kernel I got a
corrupted file error message. I tried several times to rebuild this
file without success on booting. If I uncompressed it and referenced
the uncompressed xen in the kernel line it booted without problem.
I don't know if there is something missing that while booting cannot
decompress the xen.gz or if there is a difference in how the
compression is done relative to decompression on boot.
It looks like the html isn't up to date. The XML source has a note about
grub limitation, that impose restrictions on the root filesystem
(smaller than 512Mb, formatted as FFSv1, 8k block/1k fragments).