child theme & configuration

I'm trying to figure out whether the BlogsMU theme would be a good upgrade for my Buddypress 1.6.2 site. Elsewhere in this forum there has been mentioned a child theme for blogsMU, however, unzipping the file downloaded from the WPMUdev site does not create a child theme directory. Is this something I should create myself, and if so how?

Also, how would I make the changes outlined below:

Finally, is there an online manual explicitly for the BlogsMU theme?