The process described sounds about right, except it doesn't mention copying the NandGames folder to the root of your SD/USB as, without the loader.dol that folder contains (as well as obviously having the same wads installed as channels in the nand), the ISOs cannot work.
The problem of the script appearing to stall at a particular point crops up now and then. When it 'freezes' it is clearly waiting for an input. The input either has been sent but, for some reason specific to the current user's setup, focus of the window it was aimed at was stolen by another process and it was missed
or the target window is still not the active window on the users screen and the script is waiting for it to become active / focused before it sends its data.
There are a couple of things to try.
You could just click the window (which might still not be the window in focus) and, if focus was stolen prior to data being sent, the script will now see it's target and send the text required.
If that doesn't work you could move the visible window and see if there is another behind it (if so - close it)
Or you could press escape to quit the script, start it again and choose to continue where you left off. If you find it getting stuck at the same point every time, it is worth doing a reset before re-starting to see if the interference is due to another process, perhaps with a fresh system the issue might not occur.
The problem for me is I do not see this problem
ever and, as I cannot see it happening, I am unable to tell what might be the cause.
If this happens every time without fail, all I can suggest is that if someone were able to run a screen capturing program and show me the whole process going on I might have half a chance of discovering what causes some to get this problem.
People are using this script on a myriad of different setups (VMs, XP, Win7 32/64bit etc. etc) without problem, and yet some
do get a problem, which leads me to conclude that it is not a problem with the OS or the script, but more to do with other processes that are running at the same time (which, of course, is unique to each user and most likely can only be tracked down by that user)
Sorry I can't offer any more useful help but, as I've said, I can't fix a problem that I cannot reproduce.
Show me it happening and I might be able to discover what the cause is and find a solution for you.