At OLS2007 I went to Rob Landley's Cross Compiling Linux tutorial where Rob introduced his Firmware Linux project. Unfortunately we ran out of time and didn't actually get to using the cross-compiler.
Rob's approach to cross-compiling packages is to build a native environment (using qemu) so that you don't actually have to cross-compile packages. Cool idea!
Anyway, to build the root file system that qemu will use, Rob used UML (User Mode Linux) to step around the root privileges required for mounting the loop device. I had trouble getting UML going on my laptop so I wrote a patch that evening to use genext2fs to create the root file system. Just to show how slow I am at following through, I finally sent the patch to the mail list. We'll have to wait and see if Rob likes it.
Update 2009-10-12: Rob eventually started using my patch.