My experience is that 1.4.2_ALPHA dies as described on a 768kB machine,
but the netbsd-GENERIC_MD installation kernel works okay.  If you pass it
a -a and set the root device to be not-the-memorydisk, GENERIC_MD can
stand in for the nonworking GENERIC kernel found in sets/kern.tgz.

This is probably because GENERIC_MD contains

options		BUFPAGES=800

I plan to recompile a custom kernel without an MD and _with_ that option,
but haven't gotten that far yet.  I 'spect it'll work.

-- 
Miles Nordin / v:+1 720 841-8308 fax:+1 530 579-8680
555 Bryant Street PMB 182 / Palo Alto, CA 94301-1700 / US