The thing about a video guide is I can't unprepare my system and reprepare it all in one go. Let's just walk through this a step at a time.
For RBHP, that spoof file has to be in sZAE because the game reads that first. For this, you need a separate folder just for making BIN files for sZAE. This folder should have all the same parts as the sZGE folder for it to make BINs. That means you need sZAE's title.tmd, title.tik, and banner file (this should be 000001d2.app). If you don't have those, I can help you set that part up.
Then for the upgrades midi, you'll want to have that on another odd-numbered slot, like 003. If it's in 002, it will assume it's the song folder to 001, so it won't get cached. Upgrade files are treated as a meta folder. This also means it has the same limit of about 500 KB, so keep that in mind.
For general customs, sZGE is still recommended. I see you've gotten as far as having the game reject it after loading. You're close. This is the part that stopped me from making any more custom generations, because it can be hit or miss at first. Do you have the correct common-key and ng_id? Those could be reasons for it failing. Don't worry about the banner file. It wouldn't let you build the BIN without it. If it's still not working, could you post a sample of your packing folder for sZGE? Don't include all the songs for this because I'd want to check it for other potential problems. It seems you have the WADs installed correctly. But also remember that uninstalling and reinstalling sometimes does the trick as well, especially if it wasn't installed with the correct IOS at first.
And also, you are booting the game under IOS259, right?