Since I'm trying to set up a few different types of remote system loads (PXE diskless boot, custom liveboot cds or memory sticks) it seemed like a good chance to try some other configurations. The one that I'm currently on is sort of novel to me, and the results are kind of fun.
Using QEMU, a Windows workstation can load a virtual Linux box. For this I'm using DSL (www.dslos.com) and that allows a total file size for the virtual machine to be a mere 256mb (including a 128mb virtual drive).
This is useful because the files are stored on a network share (SMB). The important thing about SMB is that it allows for specific parts of files to be read or written instead of the whole file.
However, some programs have problems running on file shares like this, so for that reason the files are mounted using Truecrypt to make the system appear as a virtual drive and for the added security. Te other benefit is that the system use becomes protected from the host, who only needs to host the encrypted file over the share.
This works out pretty nicely, because it allows me to walk up to any Windows box and within a few seconds load the Truecrypt volume and be running my persistent virtual box. Right now I am running Firefox 2 and while it doesn't fly, it is in some ways faster than Remote desktop while requiring fewer server resources.
The next step is to use a bootloader to run the persistent OS in a diskless mode. It will work fine in that situation, and something like GRUB could be configured with other better network file storage.
In either case, you could boot the same OS whether it is from the system boot or run inside of Windows QEMU. The way it's set up now, I've got to shut it down before moving between computers, if the OS were set to load a journaling or multi-user file system then that would ensure reliability.