Thank you!
I have now tested and it does fix my problem.

I have  used the hardy daily live CD and created a bootable USB stick with the 
USB start-up disk creator in Ubuntu 9.0.4
I can now boot my work laptop from the USB and I get persistence.

Are the daily 8.0.4.3 builds included in the 8.0.4.2 updates or is that
a separate track? I guess I should test.

//J

-- 
[hardy] livecd: keyword "persistent" results in busybox and (initramfs)
https://bugs.launchpad.net/bugs/219192
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