You insert the installation CDs (DVDs. tapes, whatever) into the 275s respective drives and install from there. You use the laptop with the serial terminal emulator (or your physical serial console if you have one, for instance the IBM 3153 terminal) to control this process. If your system has a graphics card installed and a monitor/keyboard already attached you can use this (in IBM terminology called "lft" - low function terminal) for installation and won't need a serially attached terminal or -emulator.

ttyS0 refers to a tty (short for teletype - another word for serially attached terminal) attached to the "S0" connector on your machine. Have a look, the ports all have labels and one of them (most probably a D-Sub 9 connector) should read "S0".

I hope this helps.

bakunin