Following the steps here
http://www.pendrivelinux.com/2008/05...a-the-live-cd/

I have successfully installed Ubuntu 8.04 on a 2GB USB disk.

Now I can save all my settings and boot from USB disk.

However, I found that booting time from live CD and USB disk are almost same!

Although applications like Open Office loads faster from USB disk compared to live CD.

I love Ubuntu