No network after installing CM7 on Xperia Arc
A "baseband" would generally refer to modem firmware.

It seems like the first step is to modify the modem firmware so CM7 can use it.

Does this flashtool have a linux binary? (This tool seems to be unique to SE phones, I didn't have to use flashtool to modify HTC phones, only fastboot.)

Found Flashtool. XDA link | Source Code Repository