I am back and still confused.
When I started this thread (post #1), I called for help when I could not use the Knoppix installer (experimental version) to install Knoppix 7.0.5 to a Sandisk Ultra 32GB with the 'p' option.
I tokk another USB key, this time a Sandisk Ultra 16GB. The 'p' option worked like a breeze, giving me an ovverlay of almost 12GB.
Does it mean that my Sandisk Ultra 32GB is rotten? Probably not, because it allowed me to install with the 'i' option. Note, howeer, that Knoppix at first refused to boot. I had the FAT32 partition checked by GParted and rebooted : all OK now and Knoppix gladly created the traditional 4GB persistent image.
Where do I/we go from there?