On toasting and grinding the peanuts and rice, toast rice and peanuts on a pan over medium heat. Constantly stir for about 15 minutes or until rice and peanuts have turned fully light brown. Pulverize using a food processor or high speed blender.
You could use peanut butter instead of toasted peanuts and rice. Just make sure the peanut butter is mainly peanuts and water.
You could find snow fungus at most Asian grocery stores.