Here was my problem the bios on my laptop does not allow me to boot from the usb and so this is what I did to get it working for me. First of all I am running Suse 10.3 natively on my laptop and this will work with any linux distro running grub as for lilo and windows boot managers I don't know I don't use ether of them.
First open a shell and with your favorite editor open vim /boot/grub/menu.lst or nano /boot/grub/grub.conf depending on your distro and add this to the bottom of the file.
Code:
title BackTrack 3 USB
root (hd1,0)
makeactive
chainloader +1
and thats it just reboot and you now have a new option in grub menu select the backtrack option and you will be taken to the lilo boot menu where you can select how you want to boot backtrack.