This can be useful with Windows Home Server in a number of ways.

- If you are building your own WHS in a small case, and don't have a DVD drive, you can transfer the WHS software to a USB flash drive of WHS to install from.

- If you are building your own WHS and require special drivers for your mass storage devices or network connection, you can make a USB flash drive of WHS w/ drivers.  You'll especially want this if the primary drive fails, and you want to use the "Server Recovery" option.

- If your PCs that are connected to the WHS require special drivers for your mass storage devices or network connection, you can make a USB flash drive of the recovery CD which includes these drivers.

Here are instructions for making such beasts.  Written for WinPE, but applicable to WHS. http://www.realtime-vista.com/general/2007/05/preapring_windows_pe_to_boot_f.htm