ya... The problem is that devfs is required for the debian mkinitrd scripts.
The solution is to compile all the things nessicary to access the file system directly into the kernel and edit the bootloader to not use the initrd image. The other solution is to import yaird and some other things from Deiban testing, which don't require devfs.
Devfs sucks balls. Hate hate hate.
Woody is way to freaking ancient to be usefull.
There is a alternative way to install Debian if your adventerious. It's Debootstrap and you can use any Linux system or live cd to do it. Most commonly it's going to be knoppix.
Basicly you go:
1. setup the partitions.
2. mount the partitions
3. use debootstrap to download and install basic packages to the system
4. edit and setup various system configuration files like $YOURMOUNT/etc/fstab
5. chroot to the enviroment
6. mount /proc
7. run base-config
8. edit a couple files, install the initrd-tools, install the kernel
9. install lilo or grub, make sure everything is right,
10. reboot into your new system.
This is how I do it sometimes. It's not to difficult, but I always miss a couple things and have to reboot into knoppix and fix them.
The nice thing is that you can do it remotely from any box with a ssh client. Just install and start sshd (/etc/init.d/ssh start or whatnot) in knoppix.
http://www.underhanded.org/papers/debian-conversion/remotedeb.html
http://www.inittab.de/manuals/debootstrap.html
http://www.google.com/search?hl=en&q=Debian+install+debootstrap&spell=1
maybe it would be easiest to locate a PS2 style keyboard and use that during the install.