This process has been documented and re-documented so many times so this will not be a technical entry. But the process works and it is brilliant.
What I do want to say is that the official instructions from the Cyanogenmod wiki work, and are simpler than anything else I read. So follow them.
The Nook Color is a tablet disguised as an ereader. Spec wise it is lacking a few things, but the build quality is brilliant and it is cheap.
I ordered a refurbished unit from ebay for $199.00. At the time this made it about $190.00 AUD. They only ship the the US so I sent it to an address provided by ComGateway. I expected to be billed for about $30 shipping to Australia, but ComGateway charged me the cost of a 2kg package. So it came in at just over $40. Of course I am not about to argue when my Nook is sitting in their warehouse. The other disappointing thing for me was that is sat in Portland at the ComGateway address for 4 days before it was shipped.
But it was shipped and there were no problems, it was just more expensive and slower than I expected.
If you want to use the Nook with the original firmware (though why would you) first register an account with B&N online using a US address, also skip the credit card setup, unless you have a US credit card.
But with CM7 this thing is brilliant. Fast and a whole bunch more functional. I no-longer have tablet envy.