A while ago Microsoft announced Hyper-V Server R2 would support booting off of a USB flash device. There is now detailed documentation on how to set this up.
http://technet.microsoft.com/en-us/library/ee731893(WS.10).aspx
What that means is you can now boot VHD’s from a USB device 
Even better if you don’t want to do the step-by-step you can download a tool from MSDN Code Library:
http://code.msdn.microsoft.com/BootHVSR2FromUSB
What is it though, that the tool does:
1.Install the Windows Automated Installation Kit (WAIK)
2.Reads the Hyper-V WIM
3.Formats your USB flash device
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4.Select your USB flash device as your target disk
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5.Creates a blank VHD
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6.Installs
Why do this? In the TechNet article it says:
… The scenario described in this document is only supported for original equipment manufacturers (OEM) …
… A Hyper-V Server UFD can provide virtualization capability for servers that ship with no local hard disks, and it offers the same functionality and flexibility as a Hyper-V Server installation on a physical hard-drive …
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This is only supported for Microsoft Hyper-V Server 2008 R2. Not for Windows Server 2008 R2.
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It is recommended that your USB flash disk be at least 8GB in size, and that you only fill your disk up to 75% to get the best performance / life span (the tool defaults to creating a 6000MB virtual hard disk). You can change the size of the virtual hard disk using the File menu.
The idea here is that OEMs / System Builders that want to make diskless Hyper-V servers (where the virtual machines are stored on some form of central storage) can do so by sticking some cheap flash storage on the disk.
Some notes to be aware of include:
While you can move the USB device from system to system and *most* things will work:
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This is not supported (if you read the whole TechNet article you will see that this is only supported if you are using a USB device that is “hard-wired” to the system).
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The virtual network switches will get disconnected whenever you move to a new system.
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To reduce wear-and-tear on your flash device, the page file is disabled by this tool. This means that you should not try and allocate every last megabyte in the system to virtual machines. Try to leave some room for processes in the parent partition.
Enough reading, eh? Go Enjoy!
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