NIOS2 HW & DIV Instructions + FPU

At least this is making more sense now.... So with the volatile keyword you were preventing the compiler from performing the floating point operations at compile time so that they would have to be executed at runtime. I would expect 0 to be read back when you attempt to use a custom instruction that is not implemented.

Make sure you regenerate your makefiles for the application and BSP otherwise those flags will still be present when you go to compile. It also appears you were confused by the floating point support. The multiplication and division options in the CPU parameterization are *only* for integer operations. If you want single precision floating point support you need to add the floating point custom instruction to the Nios II core.