I installed all the files in domain.com/ root. (Somewhere I read to install the directory and rename it wpmu, but then all subdomain blogs are .com/mpmu and I didn't want that.)
Then contact support to setup wildcard domain. (Going through steps without understanding isn't fun, but it worked.)
The DreamHost Wiki is very clear about that. 
Then, according to that wiki page, I CHMOD the root directory and /wp-content to 777.
No joy ... 500 error.
Operating blind I created subdir.domain.com and pointed its directory to domain.com ... and that worked!
p.s. I can't find how to join as a new-comer, not logged in, which is the point, but that's for another thread. Moo docs are really skimpy.