Well. This is another issue.

The 'file structure' on the DMG is MAC. ANd has to stay that way. Regardless of whether or not the image was compressed or not when zipped makes no difference in this case.

So, You will have to use a mac in order to 'clone' the DMG to a USB stick./ period.

There may be ways to do this on a PC but I know nothing about that and 1 thing is for sure...

you cannot convert this disk image and have it work. why ? because the image is exactly the way it needs to be in order to boot the ATV.

You should be able to - on a windows box - unzip the file successfully.

Cloning it to the USB stick most likely has to be done on a mac. sorry.

Interfacing with the ATV can be done through a windows machine but the actual creation of the stick should be done on a mac.

Can you unzip the image and see it ok ? and if so it should be 22 MB in size.