Problem solved! Fabain was able to help me on the IRC! You must modify the knoppix-install script to get what ever daemon you want started. To do this, you'd modify the script below:

chroot "$TR" su $USER_NAME -c mkdesktopicons

Here is an example:

chroot $TR update-rc.d daemon defaults

Will add which ever daemon(where daemon is the name of the daemon you want to start), it will place it in all run levels. So, it you wanted to start Apache:

chroot $TR update-rc.d apache defaults

If you want one daemon to start before another:

chroot $TR update-rc.d apache defaults 30
chroot $TR update-rc.d mysql defaults 35

Will ensure mysql start after apache. If you only want a daemon to start at a specific run level:

chroot $TR update-rc.d mysql defaults 35 5

Will start mysql only on run level 5(X). The problem with X not starting was due to my oversight.

cesman