It seems that the update process in the README is really out of date
(it refers to scala-2.8 and chisel-1.1).  I've updated it to what I
believe to be correct, which now just consists of pulling the Chisel
submodule.

Note that I tried this myself, but when I did it I also ran an "sbt
package" in the Chisel submodule top-level directory (there's no "sbt"
directory in there any more).  I believe it's not necessary to run
"sbt package", but I really know nothing about SBT...