I use Knoppix on a Flash with a "shared drive" approach - Knoppix looks like a couple of large files taking up room (no Vbox needed) but I'm only using Windows as an alternative that my wife knows better than Linux and sharing files for a later boot to Knoppix. Are you running Windows within the Virtual environment, I assume? If you'd like to share your virtual machine, I could try running it and see what I can do.

Cheers!
Krishna