Yes
No
There's been a guide on making a "poorman's install" (aka Hd Based) bootable for a while now, and it seems that there should be a cheatcode or knoppix script to do this (there is also a post on making the boot partition bootable). From what I understand it's possible to use these instructions for a FAT32 or ext2 partition.
a cheatcode could look like this- "boothd=/dev/hda1"
this would be used with the cheatcode "fromhd=/dev/hda1" or "tohd=dev/hda1"
When knoppix started, it would add the necessary boot files to the partition and tell the boot loader to load from whatever partition the CD was loading from (which is why this would need to be used with fromhd or tohd. The partition should be made writable so that swap and persistent home images could be made on the same disk.
a "script" could work by scanning any compatable partitons for Knoppix and giving the user a list of possible locations for the files.
In both cases, the program would need to read from a "template" and write the necessary information to the files.
Given the current capabilities of a Knoppix HD based install ("tohd","fromhd","mkdosswapfile",configuration saver,persistent home,and the "installer" which allows programs on HD to be run using the CD) I think this fill a gap in these abilities.The pros of HD based are obvious, it's possible to fit an HD based install with a persistent home onto 1 GB, while it would take >2 GB for a Hard Drive install. Also, upgrading an HD based install is a simple as copying the new files (which doesn't even require burning a CD) to the Hard Drive. As well as the fact that the copied files cannot be modified, therefore the system is very secure.
I'm pretty new to linux and haven't yet learned how to configure boot loaders and bash scripts, so I could really use this.

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