@wholycow-
First and most common reason it doesn't seem to work is that people forget (after placing custom screensavers on their kindle) to do a restart via menu>settings>etc without the USB cord being attached. If that isn't the issue, try reading NiLuJe's troubleshooting post
here... if you still can't get it to work, post your question in the screensaver thread of the Developer's Corner sub-forum and someone will get you sorted.
Welcome to the forum!
Edit- just re-read your post...you did use NiLuJe's screensaver hack by placing the file named
update_linkss_0.16.N_update.bin in your root directory and doing a restart via the menu, correct? (I don't recognize your referenced
kindle_touch_custom_screensavers_0.1)