It s not a loopback device you re looking for, but rather device-mapper.

Use dmsetup to create a device backed by the "error" target. It will show up in /dev/mapper/<name>.

Page 7 of the Device mapper presentation (PDF) has exactly what you re looking for:

dmsetup create bad_disk << EOF
  0 8       linear /dev/sdb1 0
  8 1       error
  9 204791 linear /dev/sdb1 9
EOF

Or leave out the sdb1 parts to and put the "error" target as the device for blocks 0 - 8 (instead of sdb1) to make a pure error disk.

See also The Device Mapper appendix from "RHEL 5 Logical Volume Manager Administration".

There s also a flakey target - a combo of linear and error that sometimes succeeds. Also a delay to introduce intentional delays for testing.

It seems like Linux s built-in fault injection capabilities would be a good idea to use.

Blog: http://blog.wpkg.org/2007/11/08/using-fault-injection/
Reference: https://www.kernel.org/doc/Documentation/fault-injection/fault-injection.txt

The easiest way to play with block devices is using nbd.

Download the userland sources from git://github.com/yoe/nbd.git and modify nbd-server.c to fail at reading or writing on whichever areas you want it to fail on, or to fail in a controllably random pattern, or basically anything you want.

I would like to elaborate on Peter Cordes answer.

In bash, setup an image on a loopback device with ext4, then write a file to it named binary.bin.

imageName=faulty.img
mountDir=$(pwd)/mount

sudo umount $mountDir ## make sure nothing is mounted here

dd if=/dev/zero of=$imageName bs=1M count=10
mkfs.ext4 $imageName
loopdev=$(sudo losetup -P -f --show $imageName); echo $loopdev
mkdir $mountDir
sudo mount $loopdev $mountDir
sudo chown -R $USER:$USER mount

echo "2ed99f0039724cd194858869e9debac4" | xxd -r -p > $mountDir/binary.bin

sudo umount $mountDir

in python3 (since bash struggles to deal with binary data) search for the magic binary data in binary.bin

import binascii

with open("faulty.img", "rb") as fd:
    s = fd.read()
    
search = binascii.unhexlify("2ed99f0039724cd194858869e9debac4")

beg=0
find = s.find(search, beg); beg = find+1; print(find)

start_sector = find//512; print(start_sector)

then back in bash mount the faulty block device

start_sector=## copy value from variable start_sector in python
next_sector=$(($start_sector+1))
size=$(($(wc -c $imageName|cut -d     -f1)/512))
len=$(($size-$next_sector))

echo -e "0	$start_sector	linear	$loopdev	0" > fault_config
echo -e "$start_sector	1	error" >> fault_config
echo -e "$next_sector	$len	linear	$loopdev	$next_sector" >> fault_config

cat fault_config | sudo dmsetup create bad_drive
sudo mount /dev/mapper/bad_drive $mountDir

finally we can test the faulty block device by reading a file

cat $mountDir/binary.bin

which produces the error:

cat: /path/to/your/mount/binary.bin: Input/output error

clean up when you re done with testing

sudo umount $mountDir
sudo dmsetup remove bad_drive
sudo losetup -d $loopdev
rm fault_config $imageName