Hmm, yeah, your solution was in the Debian thread. It was to just apt-get the required font packages, which doesn't quite work in this case. BUT!
Code:
[root@kindle timb]# ls /mnt/us/timb/bundle/usr/share/fonts/X11/
100dpi 75dpi cyrillic encodings misc
You'd think this should work, right?
./Xephyr :1 -fp /mnt/us/timb/bundle/usr/share/fonts/X11/
No dice.