WordPress MU

I want to copy the entire site to a new directory. I wanted to copy the entire site, all the content in the root directory and place it in a new folder so I would have a duplicate, working copy of the site to work with.
Here's what I've done:
I've created a subdomain called dev.
I created a folder inside the public_html dir where the default installation is at and called it dev.

I then copied all the files of the root directory, the entire installation of WP MU into the dev folder.

I copied the database and called it devDB.
I edited wp-config and edited this line:
define('DOMAIN_CURRENT_SITE', 'dev.mywebsite.com' );
define('PATH_CURRENT_SITE', '/dev/' );
Changed the .htaccess file so BASE is now /dev and disabled all RewriteCond entries.
I've changed the entries in the database - on the wp_1_options table, I set the siteurl to dev.mywebsite.com.

It still does not work. when I type: http://dev.mywebsite.com I get:

The webpage at http://dev.mywebsite.com/wp-signup.php?new=dev.mywebsite.com has resulted in too many redirects.....

I then added this to the .htaccess file in the new dev directory:

RewriteCond %{HTTP_REFERER} !^http://*.mywebsite.com/.*$ [NC]
RewriteCond %{HTTP_REFERER} !^http://*.mywebsite.com$ [NC]
RewriteCond %{HTTP_REFERER} !^http://dev.mywebsite.com/.*$ [NC]
RewriteCond %{HTTP_REFERER} !^http://dev.mywebsite.com$ [NC]

Man, I'm stumped!!

Next, I've decided to make the root directory of the subdomain dev outside the root folder of the original WP MU installation.

Any ideas?

Yes, update your wp-config to refelct the new lcoation, database, etc.