Hi,

As you've already found out, a USB key is essentially different from a
live-CD installation. Only if the Live-CD distribution is specifically
created to run from a USB stick, will you have any luck at all.

The concepts I used to create a USB version of the Slackware installer
(i.e. not just boot from the USB stick but also have all the packages
on the USB stick) may or may not help you further:
http://www.slackware.com/~alien/tools/usbinstall/

Cheers, Eric