When you put those lines in programmers.txt did the first entry start with 'mexisp' or 'olimexisp'. It makes a difference.
## Put these lines in (Arduino sketch folder)/hardware/programmers.txt
olimexisp.name=Olimex AVR-ISP500
olimexisp.communication=serial
olimexisp.protocol=stk500v2
## Put these lines in (Arduino sketch folder)/hardware/boards.txt
olimex328.name=ATmega328 on Olimex AVR-ISP500
olimex328.upload.using=olimexisp
olimex328.bootloader.low_fuses=0xFF
olimex328.bootloader.high_fuses=0xDA
olimex328.bootloader.extended_fuses=0x05
olimex328.bootloader.path=atmega
olimex328.bootloader.file=ATmegaBOOT_168_atmega328.hex
olimex328.bootloader.unlock_bits=0x3F
olimex328.bootloader.lock_bits=0x3F
olimex328.build.mcu=atmega328
olimex328.build.f_cpu=16000000L
olimex328.build.core=arduino
You have to shut down Arduino0022 before changing those files. When you re-start Arduino you should see the new board listed under Tools->Board