I would suggest you put CM7 on an SD card and use it that way to see if you like it, then either stay with SD card to run or get the instructions to load directly on your Nook.
I find running from SD card suits me fine as I can simply remove to revert back to stock.
Follow instructions to make a card
here
I suggest getting a Sandisk card class 4 is fine and supposedly the lower class cards work best. I use a Sandisk Class 2 4gb and it is perfect for me.