The laziest way I've come up with to install BT3 to a USB drive or a HD is to do the following.

Download the VMWare image.
Download and install VMware Server.
Crankup BT3 on the VMware Server.
Share your HD out and mount it in BT.
Run dd -if=/dev/sda -of=/<where ever you mounted your file share>/mybt3backup.img
This will take a while and you might be able to speed it up with bs=64k. I think the default is 512 bytes.

Once you have created your image, you can use it to image a USB drive or a Hard Drive.

I took my images and booted up off of a livedistro linux system recover cd and just mounted the USB drive that had the image, mounted another USB drive and then rad dd to put the image on the other drive.

You could do the same with putting on a hard drive.
dd -if=mybt3backup.img /dev/sda

The one issue I ran into with putting it on a USB drive is some laptops boot up and see the USB as /dev/sda and others as /dev/sdb.
You will get a kernel panic cannot mount vfs or something like that.

I've found once I know which laptops have the problem...
at the lilo prompt type
backtrack boot /dev/sdb root=/dev/sdb3
I have two laptops that boot fine off the USB drive and two that need to have the boot /dev/sdb root=/dev/sdb3

Oh, and you may need rootdelay=15 as well.

Hope this helps someone...