Personally I would not go with the rom manager method of install. I havent tried it so i am not bashing it, but if your like me, and i think you are, you like to know whats going on. Download the rom zip to your sdcard. Keep root, install the droid 2 bootstrap from the market. It costs a couple bucks but well worth it. Launch it, click bootstrap recovery. Allow root access. Now click Reboot recovery. You will boot in to clockwork recovery. Now use the camera button to confirm and power button to cancel/go back. First choose the wipe data/factory reset option. Now choose flash zip from sdcard. Now browse to you rom zip file, select it, and flash it. When its all done, choose reboot and your good to go.
The rom manager might work just fine but I prefer this method because this way I know exactly what steps were taken and ensure I did everything right.