Excuse me for following up to myself yet again, but in case someone else runs into this same problem...

I usually create a bootable USB flash drive by booting my remastered .iso using virtualbox, assigning the USB drive to virtualbox, and then running flash-knoppix. This seems to work very reliably.

I can then boot the USB drive from vbox, or from a "real" computer. But if I try to create a large (> 800 MB or so) persistent storage area when using vbox, it seems to always produce an unreliable storage area. Everything seems fine during the boot session where I created the persistent storage area, but on the next boot (regardless of whether it using vbox or using real hardware) there are various complaints, and the system normally won't finish booting at all.

If I create the persistent storage area using real hardware I don't seem to have this problem. I am guessing there is some weird issue with the USB device access from vbox (3.0.10), but...