Meouw has the right idea. You're creating a text node in your example, and what needs to be done is create a dom element.
This is also another case where jQuery could simplify your code. What you were attempting to do by adding the element as an html string can be done with the jQuery html( val ) function:
http://docs.jquery.com/Attributes/html#val
Basically, to apply this technique with your given example, you would include the jQuery library on your page and write the following line:
$("#someTable").html('<tr><td><input class="param" type="text" name="dummy" value="fred"/></td></tr>');
You can also create any html element on the fly and string together attributes and event handlers in one line as in the following example:
http://www.peterbe.com/plog/creating-dom-element-with-jquery
var textbox = $("<input type='text'></input>").attr('name','dummy').addClass('param').val('fred');
$("#someTableCell").append(textbox);