There's one thing I'd like to see on Knoppix that has nothing to do with space constraints or applications, and that's the ability to load the configuration archive and the persistent home directory from the same volume (although that might not be technically feasible).

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Here's a radical idea -- many of you are familiar with the Captive project, which allows one to safely mount NTFS volumes read/write. How about if a "cheatcode" was offered to download and install the necessary drivers (using Captive) right after network detection? And then allowed you to restore configuration files or a home dir from the NTFS volume?
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Although it would be nice to have some applications included that are really difficult for us "perpetual newbies" to install from source on a distro like Red Hat or Mandrake -- I'm thinking the Rosegarden sequencer/score editor for one; and MPlayer, for another. (Rosegarden is on the ISO-Top remaster, even though it's not in the K menu.)

I agree with wooac that a Knoppix distro that made it extremely easy (even easier than Morphix) to remaster would be very cool, but I don't expect that Mr. Knopper will produce that one. Someone else might!