I'm done with uboot tinkering!
https://github.com/pazos/u-boot-2009.08-kobo
It boots from internal SD by default. When frontlight button is pressed it boots from the second partition of external sd. In both cases it will use the stock kernel.
external sd must have 2 partitions:
/dev/mmcblk1p1 - fat32 (makes nickel happy and avoids fs corruption)
/dev/mmcblk1p2 - ext2 (our rootfs: debian / arch / buildroot system...)