Hello dsl and Ted,
Really appreciate for helping me here. I think I will give NIOS II the option to pass the register addresses to the IP core. So I guess custom instruction will look like this: pass addresses of operand_A, operand_B and the result register in each clock cycles to the IP core (custom instruction will be like O/P = I/P) and let the IP core do the rest. And for selecting the specific operator, I can use the 'n' signal (which can take upto 256 values, in my case I need only a few instructions) from the custom instruction to the IP core.
Please correct me if I am going wrong here.
Thank You,
Akhil