If by the sd card thing you are referring to putting update.zip on your sd card this is how you do it:
With the phone on, hit the menu soft key and go settings=>applications=>development and make sure usb debugging is checked. Now plug your phone into your pc with the usb cord that came with your phone. After the phone connects, pull down the notification bar and click on usb connected. Your phone will go to a screen with a droid, click on the gray "connect usb storage" bar below the droid, click ok in the pop up, wait a little bit while the sd card is mounted. An auto play pop up should appear on your pc, click "open folder to view files." The window and directory that pops up is the root or base of your sd card. Download and save the update.zip file directly to this location if your pc allows that, or save update.zip to your pc, then drag and drop it to that location. That simple. And this is also how you will save any other zip files such as themes, ROMs by themselves, patches, or add-ons, to your sd card. When you are done, click the gray "turn off usb storage" bar on your phone. Done.
After doing that just follow the steps in the first post of this thread to the letter. Take your time and make sure you are reading each step carefully and it should be a breeze. Most people are reporting this whole process takes them anywhere from 15-30 minutes.