Note: the MAKEDEV.bz2 file you have unpacked is not an archive, so it won't create a directory for you to cd into.
Create the device files by running the following commands:
chmod 755 MAKEDEV &&
cp MAKEDEV /dev &&
cd /dev &&
./MAKEDEV -v generic
The "generic" parameter passed to the MAKEDEV script doesn't create all the devices a user might need, such as audio devices, hdc, hdd and others. If it seems something is missing MAKEDEV has to be told to create it. To create hdc replace generic with hdc. A user can also add hdc to generic, so he would execute ./MAKEDEV -v generic hdc to create the generic set of devices files, plus the files he needs to be able to access hdc (and hdc1, hdc2, etc)
MAKEDEV will create hda[1-20] and hdb[1-20] and such but he has to keep in mind that he may not be able to use all of those devices due to kernel limitations regarding the max. number of partitions.
./MAKEDEV -v generic: This creates generic devices. Normally, these devices are all devices you need. It's possible that you are missing some special devices that are needed for your hardware configuration. Create them with ./MAKEDEV -v <device>.
The MAKEDEV package contains the MAKEDEV script.
MAKEDEV is a script that can help in creating the necessary static device files that usually reside in the /dev directory.