AndyOpie: First, 16GB is way too small drive for your purpose IMHO. If you intend to do development, you should absolutely use the DVD version, and for a sizeable persistent store, you need at least 8GB for store + Knoppix cloop. One way to try is with a 32 GB stick, using 8GB for FAT32 with the Knoppix system, and the rest for, say, ext4 with your development packages.

I would strongly recommend you to get used to ordinary Knoppix administration before you try to modify anything in more non-standard ways. Daily tasks include setting up, deleting, mounting and unmounting, and using, volumes outside of the cloop image and the persistent store.