When I did my first Knoppix remastering back in 2006, using chroot was in practice necessary. But returning to the kind of task a few years later, and following the methods outlined by other forum members here, I found that I didn't need it.
Chroot is important when a brand new OS version is created from scratch, for then there isn't anything to run yet. But I have found that as soon as I have a version able to run, it is much better working from that. And with easily configurable (in several parallel versions) persistent store, running the developing system in something like kvm is a very simple, robust and efficient way of applying and testing changes.

Working from Knoppix 7.6.1 (for example), I can run the ISO in kvm, use the flash installer to install Knoppix on the first partition of a USB SSD disk, and start creating alternatives by modifying the booting .cfg file there. When I then run (the external disk is identified as /dev/sdc)
sudo kvm /dev/sdc -m 1024 &
I can use the booting alternatives in the syslinux file. I can even do remastering safely running from the image to be remastered, if I start without persistence. And after the first remastering, I will have all necessary tools in the cloop image, so it doesn't really matter for this use case whether I use persistence or not.

Have I missed something important about chroot, as it doesn't seem to have much to offer for mye actual use?
I will need it for a knxbootstrap utility, but remastering is something quite different today.