My attempts to install Ubuntu or Xubuntu 11.10 from a flash drive were not terribly successful. Two major changes took place in the past year: a shift to using PAE kernels, and an attempt to support direct copying of ISOs to flash drives. Since a lot of users have moved on to x64 builds, which don't rely on PAE kernels; and a lot of users prefer "live" (graphical + doesn't require a full load to use) over "alternate" (text, non-live) installs; fixing the installer got overlooked.
Playing around with 12.04 installers (any new installer is found on Ubuntu's CD Image site), I was able to figure out that Xubuntu x86 uses non-PAE kernels by default; but the hd-media install was expecting a PAE kernel. I reached out to a contact that worked on the debian-installer for advice: he suggested checking with the Ubuntu folks, since workarounds he had put in place have been in use for 2 years now (something I'm not sure the Ubuntu folks incorporated, given the "2010" dates on the installer builds). Enter Ubuntu bug 977568. What's amazing, is how quickly this got fixed: all of three days for the Xubuntu folks to bounce my original diagnosis (missing kernel) to a missing hd-media installer; and to release a non-pae version of it.
Props to the folks that fixed this issue. If I didn't have to worry about supporting cheap Intel Atom boxes that didn't support x64, I might have considered migrating my loadset; my Windows boxes are almost all x64.