First step you should do . . . read the documentation! Next step . . . read it again and make sure you understand it!
Afterwards I installed it, executed it, and my site was up and running in Joomla 1.6, with the functionality of the standard 1.6 core. And this all in the first attempt. The extension does what it supposed to do.
Things I had to do by myself was, creating new 1.6 template and install plugins I used in 1.5.22 (for which some of them are not yet available for 1.6).