Ok, I renamed ramdisk.sig to ramdisk.bak and copied linux.sig to ramdisk.org. This fixed the problem and I got my original unhacked Phatbox back!
Now, I went back to my original goal of hacking the box. I got the same problem where the hack didn't apply and went ahead and followed the recommended procedure of unplugging the box as described in the Hack Tools documentation. After plugging it back in I got the same loop problem(infinite green lights and unrecognized on the Kenwood receiver), but this time I corrupted the ramdisk.sig again, turned the stereo on again and miraculously I heard the sweet words of "Your Phatbox is now unlocked". It took some work, but I did it.
Thanks for helping out!