I've recently had to do this as well.
I had a netbook with Windows XP installed that was giving the unmountable boot volume error. Unfortunately I don't have an external CD drive so I had to search for an alternative way to get to the recovery console.
I found WinToFlash.
There may come a day that optical
drives are as hard to find as 5.25
floppy drives are today.
WinToFlash starts a wizard that will
help pull over the contents of a
windows installation CD or DVD and
prep the USB drive to become a
bootable replacement for the optical
drive. It can also do this with your
You don't have to worry about
scratches on the disc or misplacing
your original media discs once you
transfer their contents to the flash
drive. The optical drive is quickly
becoming a thing of the past,
especially in office environments, as
media is shifted to the cloud.
This neat little program was very useful and allowed me to hold off getting an external drive until payday!