Arduino on breadboard with internal clock. Trouble burning the bootloader.

Hey everyone. I've read quite a few threads on trying to get this to work, so I apologize for another one.
I'm trying to follow this instructional but I am having troubles:

I have an UNO with the atmega328p, and I have been able to successfully program it and everything works just great out of the box. I decided I want to remove the bulk of the UNO and just have the atmega chip on a breadboard with the rest of my circuit. With the chip in the UNO I was able to successfully load on the AruinoISP sketch (the same way I've loaded all the other sketches to this point). If I understand correctly, the microcontroller is still dependent on the 16Mhz clock at this point. I then removed the chip from the UNO and put it on the breadboard and wired it up like this:

I downloaded and extracted the breadboard-1-6-x.zip into the hardware folder and restarted the IDE. I then selected the Tools -> Programmer->"Arduino as ISP" (not ArduinoISP), and Tools->Boards->Atmega328 on Breadboard (8Mhz internal clock). I then select Tools->Burn Bootloader.

To which I am greeted by :

avrdude: stk500_recv(): programmer is not responding
avrdude: stk500_getsync() attempt 1 of 10: not in sync: resp=0x00
avrdude: stk500_recv(): programmer is not responding
avrdude: stk500_getsync() attempt 2 of 10: not in sync: resp=0x00
...
avrdude: stk500_getsync() attempt 10 of 10: not in sync: resp=0x00
Error while burning bootloader.

I don't get it how this could work because the chip is still configured to run on a 16Mhz clock but it doesn't have one, right? What do I not get here?

Anyway, I thought that maybe I broke the chip when trying to pry it out of the UNO or something, but I have been able to put it back in the UNO and successfully program it with other sketches (after changing the programmer back to AVRISP mkll, and the board back to Genuino UNO).

I then tried a completely different chip that I bought off ebay. However I can't even program that with the Blink example sketch. I figured that the atmega chip that comes with the UNO has been pre programmed with a AVRISP mkll bootloader for the UNO board or something, and my ebay chips don't have any bootloader. So my follow up question is how do I get an ebay chip programmed to work with the UNO board?

Any ideas on how to get all this to work?

'328P in a Uno board gets 16 MHz clock from external resonator, and has 3 fuse bytes (High, Low, Extended) that are programmed to support the Uno board environment (16 MHz clock, divide system clock by 8 disabled, brownout detection to support 5V Vcc, bootloader size to name a few).
Bare chip from ebay (I don't get why folks do that vs buying chips from Digikey,com or Mouser.com which ship the same day when ordered by 8PM or so, vs waiting weeks for delivery) likely do not have the fuses set, are running from 8 MHz internal RC with divide by 8 enabled, and may or may not have a bootloader installed.
No bootloader and running at 1 MHz will definitely not talk to the IDE correctly.

Use the AVR ISP MKii and the IDE to Burn bootloader, that will set the fuses properly and install the bootloader.
If you then wish to Upload Using Programmer to not have a bootloader, the fuses will still be set correctly.

fi you don't want to use an external 16 MHz resonator or crystal, select a board type that doesn't use that and use Burn Bootloader for that board type to set the fuses correctly, and select that same board type for future serial downloads.

So my first issue was here:

I then removed the chip from the UNO and put it on the breadboard and wired it up like this

You need two chips. One that stays in the UNO that programs a second chip that is on the breadboard. This makes more sense to me now.

So now I have the ebay chip with a bootloader successfully installed. But now I can't program the chip. I rewired it like this:

but I still keep getting the same error:

avrdude: stk500_recv(): programmer is not responding
avrdude: stk500_getsync() attempt 1 of 10: not in sync: resp=0x00

And I've tried the AVR ISP programmer, the AVRISP mkll programmer, and ArduinoISP. None of which are working. The Tools->Board is still selected as the Arduino328 on a breadboard.