So this part of the project took the better part of a week and a half to figure out. Basically I had to setup a Linux Terminal Server that my Cx0 could boot off of. Really, this was the easy part, LTSP is pretty easy to get going even if you have a minimal amount of experience dealing with Linux, the install steps are about as easy as it gets.I setup the server in a Virtual Machine using Virtualbox. The reason I did this is so I could basically turn it into an appliance I could run anywhere, I just backup the image and I can use it on any system that runs Virtualbox. This also keeps me from having screw up my main machine.
The first thing to consider is you hot operating system, in my case the Cx0's are 32 bit machines, so the guest OS has to be 32 bit. You can use a 64 bit OS as host, but it is irritating in oh so many ways, and I found this out through trial and error.
There are three ways to host OS's, first you can simply use your host OS for both, 2nd you can build a Virtual machine and use that image or you can use whats called a Chroot environment. The problem with both the VM and Chroot is you have to maintain two OS's, which usually entails some other more complex tools. Building a VM is not tough, but getting it to work right is. Building a Chroot is extremely painful in oh so many ways. Again I found this out through trial and error. For the record TinyCore Linux, Damn Small Linux and Puppy Linux all make terrible thin client operating systems.
The easiest method is to simply use your host OS as your guest OS. So for me 32 bit turned out to be the best option. My guest OS also needed to run on 2GB of RAM or less and a minimal amount of video memory, so I settled on Lubuntu as both my host and client OS. The client does take several minutes to boot up, but once it does, it seems to work ok. I have to stress that it is "Just Okay", it is not great. If you worked on computers in the 90's, this will probably not be too bad, but if you are use to nearly instant on web browsers, this will be frustratingly slow for you.
As a learning experience and an experiment, this was a lot of fun, but if you intend to actually do this in some sort of production environment, you are going to want better thin clients and better servers.