What I want to know is, can I burn the bootloader for the 328 in that board while the IC is on a breadboard without? I'd like to know if this works. Even if I can easily get a crystal and caps...
Heck, I ought to just try it and see for myself...
If I'm not mistaken, the burn sequence sets fuses first and then uploads the bootloader. When avrdude gets around to actually burn the bootloader code, the atmega will be expecting an external crystal and so will not respond unless one is present.
Fuse settings used for an external crystal will work equally well with an external oscillator so one option is to hook up a 16MHz oscillator (rather than crystal + caps) to your burn target.