Thanks for this.
I have almost done what you say, but used an earlier EDP (1.5) Chameleon boots off of the USB, but I still can't get the retail image to boot. (falis with can't find mach-kernel). It's right there, on the pen, but the loader can't find it... Is this reference in plist? As you see, I'm still learning OS X.
I have two partitions on the USB. One has chameleon, the other has a ditto of the retail install.
I used EDP 1.5 because I thought you need to do the Apple software update if you use the 1.7 EDP? I remember breaking an earlier system by installing the EDP 1.6 and then NOT doing the update. It broke the system with Kernel panics. Some the EDP contents will only run with the updated kernel.