Now that 1Gb flash drives can be had for under $20 around here, I’ll have to try this one out … yes SubRosaSoft have a utility called DasBoot, but that won’t make a flash drive on the PPC Macs, only for Intel.
What is quite clever is that this gets OS X onto a 1Gb drive with some space to spare – around 11Mb free. Perhaps Monolingual could free up a little more room?
So why would you do this? Good question. First I suppose it would make a good recovery device – boot from flash to help resurrect a crashed Mac … there must also be some good uses from the paranoid set as well.
Of course the other temptation with drives this cheap is to make a RAID and install on that :-)
[Addendum: 29 march 2008]
Since this post still gets a bit of attention, I had to share these new links to a range of other Mac OS apps to install on a pen drive. Without further ado: WebWorkerDaily reported on eleven go anywhere mini applications for the Mac in December 2007. That list included wireless tools, word processing, image processing, backup, maintenance and messaging tools. They followed that up in January 2008 (More mini Mac apps for your pocket USB thumb drive) which expanded the list to ftp, more text with TextWrangler (though not so little!) and even a tool to remotely wake a sleeping Mac!
Of course with flash drive prices crashing all the time, OS X on a drive seems more reasonable when you can buy an 8Gb usb pen drive at a sensible price. Add in these ‘portable’ apps and perhaps some recovery utilities and you could have your cake and pretty much eat it too. Feel free to comment and leave links to any new information on the topic!