It seems that the Amiga cannot find the program "rx"? I think that program was part of Workbench since v1.2
If that is the case try typing "c:rx ram:setup"
If that doesnt work, you may have booted using the wrong disk?
I would just use a 720k floppy disk!
If all you have is regular 1.44Mb cover the hole on one side (not the right protect tab, other side), use a bit of paper and cellotape, or if you are like me chew up the paper and stuff it in the hole.
Stoopid Windows XP removes the ability to format 720k disks, so you have to open an MSDOS window (run cmd) and type
format a: /t:80 /n:9
Copy the files over and you should be fine.
As the readme says, if they've been stoopid enough to put files that are bigger than the 8.3 you can use you may have to restore them to their real names after copying (Cross Dos that comes with AmigaOS doesnt support long filenames)