The nvidia installer claims that modversion.h is missing and that the kernel sources are not configured. So I installed them with the package manager and followed the official instructions:

make xconfig:
make dep:
make clean:
make bzimage stopped; no rules etc...

make modules.
make install:
make modules-install; stopped: no rules etc...

Also, no /lib/modules/2.6.3-4mdkcustom, skipping creation of inird,
and
defaulllt vmlinux version is not the same as initrd, you have a mdk kernel but not a mdk initrd.

What should I try in order to install the sources corrrectly?

make dep went out with the 2.4 kernel series. If you want to clean the kernel source use make mrproper not make clean. If I were you, I would put a copy of your old kernel .config in the source folder then

make menuconfig
make
make modules_install
cp arch/i386/boot/bzImage /boot
cp System.map /boot

Then update your bootloader so it boots the new kernel

If you copy an older .config file into a source directory make sure to run 'make oldconfig' also.

Okay guys, it's done and working, new procedure noted, thanks a lot. Next post for nvidia installer prob!

nvidia install should be okay up to 2.6.9-rc2 with 6111 driver

need patched one for 2.6.9-rc3

The kernel sources seem to be installed ok as make and make_modules_install went through ok.
However, the nvidia 6111 installer doesn't like the rivafb as a module and stops before completion. Here's the installer log, or should I put this in another post?

How to stop the rivafb module loading? Do I need to make another kernel and install it?