Installation of PE2USB:
You should copy the files pe2usb.cmd and pe2usb.bin to your
directory.

For successful installing BartPE to a USB flash disk you need:

1) A USB flash disk with a capacity of 256MB or more
2) Server 2003 SP1 (or a release candidate). You can download this from
http://www.microsoft.com/downloads/details.aspx?familyid=02734CEA-7A4B-4D95-B220-8E1708C3ED46
This file is large, about 350MB!!!
Unpack the files from the service pack (this is not installing) with:
sr1sp.exe -x, lets assume you extract it to c:\server2003sp1
Create the folder \srsp1
Copy the file c:\server2003sp1\i386\setupldr.bin to the \srsp1 folder
Expand the file c:\server2003sp1\i386\ramdisk.sy_ to the \srsp1 folder
expand -r c:\server2003sp1\i386\ramdisk.sy_ \srsp1
You can now remove the c:\server2003sp1 folder, not needed anymore...
3) Build BartPE using pebuilder as normal, you must set the output folder to
"BartPE", you do not need to generate an ISO image for now.
4) Run "pe2usb -f " to format and install the files to your UFD.
Formatting is only needed the first time, so next time you can run
"pe2usb " (without -f) to update the BartPE files.

For successful booting BartPE from a USB flash disk you need:
1) A PC that is capable of booting from a USB flash disk with 256MB memory
or more.

1. Created the BART PE disc/directory with a iso ready (test on a CDR that it works properly)
2. Using the "HP USB Disk Storage Format Tool, V2.1.8, format the USB drive to FAT partition. It must be a FAT partition to be able to boot, this will limit the drive size to 2GB due to it being FAT.
3. I then downloaded FlashBoot and used its wizard to convert my BART PE iso into a bootable UFD. They have a free trial you can test out first before you buy it for $35, so you know it will work for you and your flash drive. The trial software allows the created UFD to only run once and then erases its own boot records so its not bootable anymore.
   
   I've read on other forums of reports that the flashboot created device can be restored to be bootable again by booting to a Windows XP SP2 disc and going into the Recovery Console while the UFD is plugged in. And running the FIXBOOT {UFD drive letter}: command to repair the boot record of the UFD. I haven't tried this yet, but others reported success with it.
   
   More information about FIXBOOT and FIXMBR can be found here.