This can be caused by a variety of problems:
If you've built your own kernel, you may have left out some necessary patches - specifically the cramfs initrd patches. When building a custom kernel, you should build it within the SystemImager source tree. If you're trying to build a newer kernel than was included in this SystemImager release, some patches may need modifications to get them to apply. Read the comments at the top of the patch files to understand what they do, and be careful not to remove patches unless you know they do not affect you.
If you've built your own kernel, you may have left some stuff out of your kernel config file. Look for things like initial ramdisk support, compressed rom filesystem support, etc. It is usually best to start with the .config in the patches/ directory, and modify it as necessary.
You may not be passing the appropriate options to your kernel. Take a look at the sample config file for your bootloader that was included with this release to get the list of options you need to pass, e.g. /etc/systemimager/pxelinux.cfg/syslinux.cfg.