Is this homework or a personal project?
If it's for your own personal use and you want to really learn how a distro is created, try going through
Linux From Scratch - it'll basically walk you through a completly manual Linux install - everything from source, starting with your compiler/toolset and working your way up. We're talking a couple-week project here, but it's an *excellent* learning experience!
If this is for homework, well then, this is way too much trouble to spend on school :P