Ah, this is a common misperception
A .src.rpm file is not what you want. The When you downloaded and instsalled kernel-2.6.8-1.521.src.rpm file is intended for folks who want to build the shipped kernel (with all the included configuration files) on their system using rpmbuild.
What you want is the 2.6.8 version of the kernel-source-2.6.8 package. It won't be a .src.rpm package, just a pure .rpm package.
You can do this via apt or yum (if you have them configured) or up2date, or just download it from the fedora site.
Once installed, cd to /usr/src and you'll see a linux-2.6.8-1.521 (or something similar) directory. cd into that directory, run make menuconfig (or make gconfig or make xconfig -- a gtk or qt based version of menuconfig) and select your options. Once you've run that gauntlet, type make && make install && make modules_install and yer good --- just read the README ....