kandc4u,
The appliance can help you deploy your OS over PXE, but you need to do some set-up first (like importing pxe-boot-files from the OS you want to deploy). When the mounting doesn't work, you have probably not been able to import the boot-files. Creating a template will not work properly either then... let alone booting a new client...
Please post the error message you get when mounting the iso/importing the OS files....