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How was your loading speed on a USB device?
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It is slower than running from the HD but still perfectly useable. The portable versions of FF and TB are set to be disk light (cache turned off etc.). However, if you were going to run applications frequently then a non solid-state portable drive might be the way to go.
In any case I just use the two Mozilla apps to get e-mail and web access when traveling. They have worked very well for that. The only problem is that USB drives will not work as a guest on Windows 98, because 98 needs drivers to mount new USB drives (newer versions of Windows will automatically mount attached USB drives).
For those interested here are two more links to truly portable and "portable" (applications that may not be designed as portable but do not require access to the local drive - in some cases that means copying an existing install to the portable drive).
http://www.tinyapps.org/
http://www.kikizas.net/en/usbapps.html