walkthrough on site-to-site VPN in PIX PDM?

Hi All: Still not clear on the appropriate config when setting a up a
site-2-site VPN using the PIX PDM 3 wizard.

desired VPN is:

192.168.1/24 -> PIX 1 -> internet <- PIX 2 <- 192.168.0/24

Running the VPN Wizard on PIX 1, I do the following:

1 select outside IF
2 enter Peer address
3 enter a pre-shared key
4 leave default IKE Policy (3des, md5, group2)
5 leave default Transform Set (3des, md5)
6 select inside IF / 192.168.1/24 for local site
7 select inside IF / 192.168.0/24 for remote site*

at this point, I receive the message:

"PDM cannot find 192.168.0.0 255.255.255.255 on the interface inside. Would
you like to addd this host or network now?"

If I say "OK" I'm prompted to add the host/network and assign it to an
interface and give it a name.

I'm not clear which interface to add it to though? Inside or outside?

Am I doing the wrong thing at step 7? It's not clear to me where the remote
subnet is supposed to placed.