It took me a while to figure this out, so I'll post it in case anyone else has the same problems.
My builds were failing with errors saying "mksquash" and "chkconfig" not found (this was with livecd-tools-001-2, with 001-3 it didn't say this but failed anyway). Also, "pwconv" was failing. The following worked for me: once root type
PATH=$PATH:/sbin:/usr/sbin export PATH
Using livecd-tools-001-3 and the provided configuration RPMs (6.91-2), I got a working livecd. Though there were still some error messages (see below), and I could not mount either a USB drive or a CD with the livecd. I don't know if this was because I'm still missing some further commands. The mount error pop-up said
"Cannot mount volume Error org.freedesktop.Hal.PermissionDenied Details Permission denied: Not in active session"
The build errors were:
warning: libmng-1.0.9-5.1: Header V3 DSA signature: NOKEY, key ID 897da07a warning: vpnc-0.3.3-15.fc7: Header V3 DSA signature: NOKEY, key ID 1ac70ce6 warning: system-config-network-1.3.96-1.fc6: Header V3 DSA signature: NOKEY, key ID 4f2a6fd2 cp: cannot set setfscreatecon `system_u:object_r:sbin_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:insmod_exec_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:modules_object_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:modules_object_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:modules_object_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:modules_object_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:modules_object_t:s0': Permission denied cp: cannot set setfscreatecon `system_u:object_r:modules_object_t:s0': Permission denied error: %post(policycoreutils-2.0.2-3.fc7.i386) scriptlet failed, exit status 1
-- snip --
Building an initramfs at /boot/livecd-initramfs.img for kernel 2.6.20-1.2942.fc7 FATAL: Module ide_cd not found. FATAL: Module usbhid not found. /sbin/mayflower: line 664: popd: /home/user/livecd: No such file or directory Done; initramfs is 3.1M.
thanks Luke