Just wanted to report on my recent installation of CM7:
I recently received a new NC (had a hardware problem with the screen on my old NC).
The NC came with 1.1 installed.
I used autonooter 3.0 to root. Worked great.
I downloaded Clockwork Rom Manager from the Market. I clicked "install clockwork recovery". I was asked if I had Nook Color or Nook Color (old). I selected Nook Color and it installed CWR 3.0.1.0. I then reboot the NC to make sure the installation was good. (I had heard reports that this solved any issues of boot loops with Autonooter 3.)
From the dual-boot thread on XDA, I downloaded the "dual-boot prep" and the "move Eclair to dual boot" and from the CM7 MOD thread I downloaded the most recent build and the CM7 gapps zip files to my SD card and then used Rom Manager to select "reboot to recovery".
In CWR 3.0.1.0; I "installed from SD card" the dual-boot prep; then the move Eclair (which is the stock rooted rom) to dual boot. This meant I now had 2 installations of Eclair (stock rooted rom). I then followed the installation instructions for CM7 (format system/cache/data) and installed from SD card the CM7 build and then the CM7 gapps.
I then selected REBOOT and BAM, I am now dual-booting with CM7 on the primary (default) boot; and the alternate boot (selected by holding the N button while powering on the NC) is my rooted stock ROM.
I have subsequently used CWR to flash the new Dalingrin OC kernel for CM7 (that is the benefit of have the CM7 on the primary "partition" is that I can use CWR to flash updates w/o needed to wait for them to be modified for dualboot.
WOW, CM7 is working great!!!!!
For the rare occasions I still need the stock, I can easily reboot into Eclair. The only time I anticipate doing this is when my 4 year old wants me to read to her at night ... as the nook kids books still don't work on the Nook android app