Once you've download your copy of Pancake, unzip the file and upload the pancake directory somewhere publicly accessible on your web server. You may rename it to anything you like.
Pancake uses .htaccess to remove that the index.php from your urls, giving you clean urls if you wish. This is a hidden file, so be sure to set your ftp client to "view hidden files" and make sure you can see .htaccess in the pancake folder on your web sever.
After the files have been uploaded, visit the url where you have uploaded Pancake.
You'll be presented with a list of ingredients needed - your pancake license key and database details. Get those together and hit install.
First Pancake will check to make sure the installation requirements are all there.
Next you'll be asked to add the database details.
Finally the Pancake installer asks you for few configuration details that just ensure you can start invoicing right away.
That's it! Now go make yourself up some pancakes.