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Hello,
the operation you've described is theoretically posiible, but I suppose it's better be performed in a following way:
make an image of the installed OS/2 as you wanted to do. Then put it on some CD/DVD to make it possible to use in a VM. Then boot the VM with that CD/DVD using Linux Live CD and copy the image to the VM's HD again with dd.
Best regards,
Alicia.