boot up using your bt4 dvd.
after getting into bt4 plug in your usb flash memory (the one with bt4 on it).
use this command:
mkfs.ext3 -b 4096 -L casper-rw /dev/sdb2
this is assuming your usb stick is identified as sdb. this will format your casper partition and you get your distro as good as new.
btw I'm a linux noob but it is clear that formatting your casper parition is the way to do it. if anyone knows a way to do it from within bt4 thats on the flash then that would be faster than using the live dvd.