1. Go to MapData for the room you're working on and set the Special Boss to Monster X, and use NpcX.bmp for the NPC Set 2 option.
2. You don't have to do anything else, other than look at the scripts on how to start the boss battle with him, Monster X isn't affected by gravity, so he can come from out of nowhere if you have a smaller map. If you want the battle to be more immediate with his presence being there right away, make a room that is at least 180 tiles wide.
3. Monster X generally spawns in this area, as marked through this modified Labyrinth map (it's 180 tiles wide), so go nuts if you wanna make the room feel visually smaller than it really is. If you're daring, you can even place an <FON on a null entity and have the room only focus on the area (this is probably more recommended if you're working on a widescreen mod, now that I think of it, oops). Just don't forget to do <FOM0016 once either the battle is over or you <TRA to another room.