clayg,


Welcome to Justlinux.

Been two years since I wrote this thread.. I think it explains some of your problem. Haven't tried much on USB pen drive since because an external hard disk is much faster and easier for the same thing.

If you want the Linux to work as a Live CD just copy the files, after expanding them from the iso file by a loopback device, onto the USB and change the isolinux to Grub. The above thread gives several conversion examples. They are pretty straight forward.