There are several different ways this process can be done, but what I will outline works. Feel free to make changes, take shortcuts, or modify procedures, but understand what you are doing and how it works!

(1) Start by backing up the image in the receiver. Make a Full Backup using BackupSuite or similar. Do this before doing anything else.
(2) Start a telnet session. Telnet into the box and make a root directory folder named 1. (Telnet commands listed below.)
(a) cd /
(b) mkdir /1
(c) ls
Use "ls" to verify that folder 1 was created in the root file system

Next, transfer the rootfs.tar.bz2 that you want to open or decompress to the folder 1 in the receiver.
Decompress it by doing this in telnet:
cd /1 (root@vuzero4k:/# cd /1)
tar -vxjf /1/rootfs.tar.bz2 (root@vuzero4k:/1# tar -vxjf /1/rootfs.tar.bz2)
The file will decompress. Watch the telnet output and verify there are no errors.

Delete the rootfs.tar.bz2 file from the folder 1 now. You do not need it anymore in this folder!
Leaving rootfs.tar.bz2 will cause it to be included when you compress these files. This will cause boot failure!
Make any changes to the file system that you desire.

Repack or Compress:
Make certain the Original rootfs.tar.bz2 has been deleted from the extracted file system. Check using the telnet "ls" command (root@vuzero4k:/1# ls).
Compress the file system usingtar cpjf /1/rootfs.tar.bz2 . (Please note the period after bz2!)
root@vuzero4k:/1# tar cpjf /1/rootfs.tar.bz2 .
tar: ./rootfs.tar.bz2: file is the archive; skipping
Wait for the compression to finish. Look for this.
root@vuzero4k:/1#
Check it using "ls". The rootfs.tar.bz2 should be in folder 1. The size of rootfs.tar.bz2 may be different when compared to the original. The NEW size of rootfs.tar.bz2 will depend on what changes were made.

Basically, that is all that has to be done. You may return the modded rootfs.tar.bz2 to its correct location in the image folder, and install the image into the receiver.
It would be a good idea to delete folder 1 from the system files if you are going to continue running the receiver without doing anything else. Restoring the backup is an easy way. You may also remove folder 1 from the system using telnet or FileZilla.

There is a lot of customizing that can be done with enigma2 receivers. File systems like rootfs.tar.bz2 make changing things very easy. I would like to see more interest in modifying enigma2 systems, especially in North America. I am open to ideas or suggestions.