I will double check to see if I have selected the 'Stored in reserve
extra space'.

Evan, persistence is a supported feature of usb-creator. Can you let me
know what parts of the filesystem are persistent (/home? /usr?
everything?) and how this is accomplished?

Meanwhile I would like to suggest that the words in usb creator be changed to 
the following:
1) Discard. Tooltip: Discard all changed at shutdown, exactly like a CD.
2) Persist. Tooltip: Changes made to the USB disk are saved, unlike a Live CD. 

I would also suggest that Discard be the default behavior.

-- 
usb-creator creates persistant storage instead of emulating a Read-Only CD
https://bugs.launchpad.net/bugs/492642
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