there is additional information in the "Creating Your DNN Distribution Definition" of the DotNetNuke Module Developers Guide.doc in your documentation folder.
You can also use dotnetnuke to generate PA's, including the .dnn files for you. Simply log in as host, and go to host->module definitions .Click the pencil to the left of your module, and then use the 'create private assembly' option at the bottom. Finally, if you're creating .dnn files by hand you can use the module definition validator at the bottom of the host->module definitions page to test them (it uses the various xsd files to to validate)
Cathal