First attempt lead to error messages about the malformed or non-existent install.rdf file. Well, I knew it existed because I brought it into existence. So I looked around the other mozilla documents and made a replacement install.rdf - no error.
After this point though, I hit a wall because I could install the extension and yet the tabs weren't being added to the side. So I checked the Error Console, no errors related to the addtabbeside extension. After entering some dump() messages in the addtabbeside.js file I try again, starting ff with -console. Nothing to go on.
Anyway, a while later I found mullin on IRC and we troubleshooted it. He knew that the xml spacing is all messed up with you copy and paste from the wiki - I started from scratch paying closer attention to the indentation and voila!
So what I have learned from this is to be careful of indentation when I copy and paste. I look forward to my next extension, when I can really get deeper into modifying the browser, like menu items and whatnot.