Ok, I get the same error code without the hex edited kernel on everything else I've tried so far. Happy Birthdays, MUSYNX, and the Seiken Densetsu Collection (聖剣伝説COLLECTION). Immediate fail to install with that error. Seiken Densetsu may not have converted correctly (will test it with the hex edited kernel in a moment.)
EDIT: Ok, Seiken Densetsu Collection did not convert correctly. It produced a 173MB NSP file for a game with a nearly 2GB XCI, so I was pretty suspicious. The other two games will install and play with the hex edited kernel but neither will install or run without that edited kernel.
SD3 is the ONLY XCI game i want converted, didnt work for me either