Squarez comes with a 1.0 EBOOT, which means you don't even need the Squarez or Squarez% folders. Just make a new folder in PSP GAME401, name is Squarez.
Then, take the EBOOT.PBP that is in the same folder as the ReadMe.txt file when you first extract and put it in the Squarez folder.
You will probably have to copy the "Custom" and "Themes" folders that are in the original SQUAREZ folder (the one you didn't make) into the one that you did make.
I tried Making a new folder in GAME150 and in GAME. It didn't work. You said GAME401? I moved the Eboot.pbp from root of extracted and put it in SQUAREZ folder yet it still says corrupt data.
K, I got my PSP out and tried. I wasn't able to get it working, with either of the two versions of the EBOOTs. They kept showing up as corrupt data for each of the three versions of the game I tried (0.7.5, 0.8.1, and 0.8.2).
It's possible that the SEI tool they used to create the EBOOTs may have corrupted them for CFW versions. I haven't used devhook for a while, so I couldn't tell you whether it would run this or not, but I highly doubt it.
