Looks to me you're trying the poor man's install instead of the full install method. Have you tried opening a console window and used the following code to install knoppix to the computer:
Code:
sudo knoppix-installer
That will install a full blown debian-like system assuming you choose debian install instead of knoppix install. Note, it's best to configure your system preferences, cheatcodes, etc first before installing knoppix, as that will transfer to the hard drive exactly as is, preferences and all.