For a start it isn't as easy as just writing a file if you want the CD to be bootable.
The first thing you need to do is get CDBOOT/2 v2.00 from hobbes and read the documentation, it tells you how to setup a bootable cd.
You may be able to use the .img file without modification but you will need to unpack the iso, so more searching on hobbes for ISOFS and MKISOFS (included with CDRECORD).
That should get you started.
ivan
edit: ISOFS isn't on hobbes but it is here
http://home.clara.net/orac/os2.htm#isofs