Theoretically, you should be able to boot from a USB drive. In practice, it seems that it depends, a lot, on the BIOS support for legacy USB, and whether the system will actually boot from such a device.
I have tried, a couple of times, with no success, but the problems point to defective BIOS support for doing such a thing.
It should be possible to boot from a USB CD drive, using the same methods used by the eCS 2.0 RC6a (perhaps also RC5??) installer, and described in the latest instructions for the eeePC (it is at HOBBES).